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Secret FTC Investigation of Car Dealers Who Declined Truecar Discovered by DC Reporter

FTC acknowledges auto dealer probe after discovery bust-up...

Edited Excerpt from Article Written by Harry Phillips

The Federal Trade Commission's battle to get Ralph Paglia, a car industry blogger to hand over confidential communications, private email, subscriber lists and documents about Truecar, an online price comparison website has shed new light on the antitrust authority's ongoing and ill-advised investigation of what they claim to be potential wrongdoing among thousands of car dealers. (Harry Phillips is a reporter for "Global Competition Review" in Washington, DC. They cover antitrust news and frequently report on the Federal Trade Commission.)

Mr. Phillips wrote a story last week on news that the FTC has filed a petition in Nevada Federal Court asking it to compel Ralph Paglia to provide documents and give testimony in connection with its ongoing investigation of the auto dealership industry and an alleged refusal by many car dealers to do business with TrueCar.com in late 2011 and early 2012.

  

The FTC alleges that Ralph Paglia failed to provide various records and documents requested by the FTC within each of several civil investigative demands (CID subpoena). FTC states that the first CID was sent to Paglia in May 2014, and is now seeking an injunction in a Nevada Federal Court compelling Paglia to cooperate.

The big question that Harry asked Ralph was whether or not Ralph would comply, and if so, he sought Ralph's confirmation that he now planned to comply with the FTC's demand... Or alternately, would Ralph oppose the commission's demand for an injunction? He sought Paglia's comments on the petition and the FTC's investigation of Car Dealers who either cancelled participation in the TrueCar Auto Buying referral system, or never signed up in the first place.

 

Ralph Paglia's email reply to Harry Phillips is shown below:

 

"Mr. Phillips,

Thank you for reaching out, and I would like to speak with you about the matter via phone. Since the NSA and presumably the FTC is studying all emails I send despite the illegal nature of such surveillance, I would feel more comfortable speaking with you by phone.

I can tell you that I have never refused access to any information or records by the FTC, but I am not going to do their jobs for them. I believe slave labor was outlawed quite a few years ago and I am mystified about why the FTC seems to believe they can compel me into forced labor when their staff gets paid plenty to do the work themselves.

Beyond the Nazi-like zeal the FTC seems to have for compelling Americans to do work without compensation, I simply do not understand where the Federal government gets the authority to try and squash freedom of speech, freedom of the press and determine whether an individual should to do business with a particular company.

Ralph Paglia
rpaglia@gmail.coma href="mailto:rpaglia@gmail.com">mailto:rpaglia@gmail.com>"


Point of Contact: 

Harry Phillips, Senior Reporter for "Global Competition Review"
www.globalcompetitionreview.com/usa

2401 Pennsylvania Avenue, Suite 300
Washington, DC, 20037   Harry.Phillips@globalcompetitionreview.com 

Depending on your e-mail client, you may be able to follow the link in the email. If not, please open a web browser and open this link:  http://globalcompetitionreview.com/news/article/36841/ftc-acknowled... For more information, please visit: http://globalcompetitionreview.com/
  
From the Most Recent FTC Filings in Federal Court:
 
FTC STATEMENT OF FACTS
The FTC is investigating whether certain participants in the retail auto industry, including auto dealers and industry consultants, have engaged in an unlawful group boycott of TrueCar, Inc., a firm that helps auto dealers market their cars. TrueCar operates websites that provide detailed information about specific vehicles to potential automobile buyers, and attempts to match potential buyers with sellers. In late 2011 and early 2012, numerous comments about TrueCar appeared on various websites, online blogs, and online social networks that are frequented by auto dealers. These comments criticized TrueCar’s program of online reverse auctions, and other features of TrueCar’s websites, as unfavorable to dealers, and asserted that TrueCar was inducing dealers to sell cars at prices that were too low. Many of the comments urged dealers to discontinue their participation in TrueCar’s reverse auctions, and to terminate their dealings with TrueCar. During this period of time, the number of dealers participating in the TrueCar program and the number of auto sales consummated using TrueCar’s websites declined. See Pet. Exh. 1 (Westman-Cherry Decl.) ¶2.
 
In February 2012, TrueCar announced that it was eliminating the reverse auction feature on its websites and narrowing the set of pricing and cost information that its sites would reveal to consumers. After TrueCar made these changes, numerous auto dealers resumed doing business with TrueCar. These changes may have made it more difficult for consumers to comparison-shop using TrueCar’s websites, thus relieving pressure on dealers to offer aggressive bids to consumers, and possibly leading to retail price increases. See Pet. Exh. 1 (Westman-Cherry Decl.) ¶3.
On January 17, 2014, the Commission issued a Resolution Authorizing Use of Compulsory Process in Non-Public Investigation, File No. 131-0206 (Pet. Exh. 2). As part of the investigation, the FTC staff is inquiring whether certain consultants, dealers, or other persons or firms involved in the retail automobile industry may have organized, facilitated, or participated in a group boycott of TrueCar. Such actions can constitute “unfair methods of competition,” which are prohibited by Section 5 of the FTC Act, 15 U.S.C. § 45. See Pet. Exh. 1 (Westman-Cherry Decl.) ¶¶2-4.
 
Respondent, Ralph Paglia, provides auto dealers with consulting services, information, and training relating to online marketing. Mr. Paglia writes frequently about online marketing and other topics of interest to auto dealers, and disseminates his writing through blog postings, comments on online social media networks, and publications on other online forums and websites. He also operates, manages, or moderates several such blogs, websites, and online social networks. See Pet. Exh. 1 (Westman-Cherry Decl.) ¶¶5-6. Many of the communications criticizing TrueCar’s business model and urging auto dealers not to participate in TrueCar’s reverse auction program appeared on websites and blogs that Mr. Paglia operates or administers. Moreover, materials on Mr. Paglia’s websites and blogs indicate that some industry consultants, dealer groups, and other businesses may have communicated with one another outside of the websites about matters relevant to this investigation. Id. ¶6. FTC staff asked Mr. Paglia to provide such information on a voluntary basis, but those efforts were unsuccessful. Id. ¶7.
 
On May 2, 2014, the Commission issued a CID (Pet. Exh. 3) requiring Mr. Paglia to produce specified documents and to respond to written questions. On June 18, 2014, the Commission issued another CID (Pet. Exh. 4), requiring Mr. Paglia to appear and give oral testimony under oath at an investigational hearing to be conducted by FTC staff at the Office of the United States Attorney in Las Vegas, Nevada. Pet. Exh. 4, at 1. See Pet. Exh. 1 (Westman-Cherry Decl.) ¶¶8, 11. The Commission served both CIDs via Federal Express, with receipt-signature requested (and secured). Id. ¶¶9, 12; see Pet.Exhs. 5, 6.
 
Mr. Paglia failed to comply with either the May 2 CID or the June 18 CID. He has not produced the documents or other information specified in the May 2 CID, and did not appear at the investigational hearing, as required by the June 18 CID. See Pet. Exh. 1 (Westman-Cherry Decl.) ¶¶10, 13. Mr. Paglia neither petitioned the Commission to quash or modify the CIDs pursuant to the applicable statute and Commission rules, see 15 U.S.C. § 57b-1(f); 16 C.F.R. § 2.10, nor did he submit any objections to any of the particular specifications or terms in the CIDs. See Pet. Exh. 1 (Westman-Cherry Decl.) ¶¶10, 12. To date, Mr. Paglia has not communicated with FTC staff concerning either of the CIDs, nor responded to their other attempts to reach him. Id. ¶14.
  
 
FTC HAS AUTHORITY TO CONDUCT THE INVESTIGATION
The Commission unequivocally is authorized to conduct the investigation and issue the CIDs at issue here. Congress has granted the FTC broad authority to investigate acts or practices that may violate the FTC Act’s proscription on “unfair methods of competition.” 15 U.S.C. § 45(a). Section 3 of that Act empowers the Commission to:
“prosecute any inquiry necessary to its duties in any part of the United
States.” Id. § 43. Section 6(a), in turn, authorizes the Commission “[t]o gather and compile information concerning, and to investigate * * * the organization, business, conduct, practices, and management of any person, partnership, or corporation engaged in or whose business affects commerce,”
with certain exceptions not applicable here. Id.§ 46(a). And, as noted above, Section 20(c) of the FTC Act authorizes the Commission to issue a CID to any person who may be in possession of documents or other information relevant to an FTC investigation. Id. § 57b-1(c)(1).

The two CIDs at issue here concern an investigation into whether certain automobile dealers, consultants, or other businesses engaged in “unfair methods of competition,” in violation of Section 5 of the FTC Act, by “agreeing to restrain competition” or “agreeing to refuse to deal with TrueCar, Inc.” Pet. Exh. 2 (Compulsory Process Resolution), at 1. Accordingly, the investigation to which the CIDs pertain is well within the scope of the FTC Act’s Section 5 prohibition. See 15 U.S.C. § 45(a) (“Unfair methods of competition in or affecting commerce, * * * are hereby declared unlawful.”). Thus, the Commission indisputably is authorized to conduct its investigation and to issue the CIDs to Mr. Paglia.
 
EVIDENCE SOUGHT IS RELEVANT TO THE INVESTIGATION
Both CIDs are designed to elicit material information that is relevant to the Commission’s investigation. The specific document requests and interrogatories set forth in the May 2 CID required Mr. Paglia to produce documents containing or relating to Mr. Paglia’s communications, correspondence, or meetings with TrueCar and other auto dealers, as well as documents, including blog posts, pertaining to the effect of TrueCar’s services on retail auto prices, auto dealers’ decisions on whether to stop participating in the TrueCar reverse auction program, and Mr. Paglia’s role in operating and controlling the content of the relevant websites and blogs. See Pet. Exh. 3, Schedule, Specs. 1-6. The June 18 CID sought Mr. Paglia’s oral testimony on the same topics. See Pet. Exh. 4, at 1, 3.
The FTC investigation is focused on whether those communications or other interactions among such parties constituted or related to a potential group boycott of TrueCar. As the FTC’s lead investigating attorney has testified:
“the investigation would be furthered by obtaining information Mr. Paglia may have in his possession relating to the online communications, direct communications, and other activities at issue in the investigation.”
Pet. Exh. 1 (Westman-Cherry Decl.) ¶7; see id. ¶¶5-6, 14. See Dynavac, 6 F.3d at 1414 (in seeking judicial enforcement of its compulsory process, the government’s “slight” burden “may be satisfied by a declaration from an investigating agent.”).
 
The CIDs seek information that is demonstrably neither “incompetent [n]or irrelevant,” to the Commission’s lawful investigation. Golden Valley, 689 F.3d at 1113-14; see also Karuk Tribe Hous. Auth., 260 F.3d at 1076 (same); Children’s Hosp. Med. Ctr., 719 F.2d at 1428 (same). They should, therefore, be promptly enforced by this Court.
  
DECLARATION OF
MELISSA WESTMAN-CHERRY 

Pursuant to 28 U.S.C. § 1746, I declare as follows:
 
1. I am an attorney employed by the Federal Trade Commission (FTC or Commission) in Washington, D.C. I am authorized to execute this declaration verifying the facts that are set forth in the Petition of the Federal Trade Commission for an Order Enforcing Civil Investigative Demands (Petition). I have
read the Petition and have reviewed the exhibits thereto (referred to hereinafter as “Pet. Exh.”), and verify that Pet. Exh. 2 through Pet. Exh. 6 are true and correct copies of the original documents. (This declaration is Pet. Exh. 1). The facts set forth herein are based on my personal knowledge or information made known to me in the course of my official duties.

2. I have been assigned to work on an investigation into conduct relating to TrueCar, Inc. TrueCar is a California-based company in the business of operating websites that match potential automobile purchasers with sellers and provide detailed information to consumers about the pricing of specific vehicles. In late 2011 and early 2012, numerous comments about TrueCar appeared on various websites, web logs (blogs), and online social networks targeted to auto dealers. These comments criticized TrueCar’s unique program of online “reverse auctions” and other features of TrueCar’s websites as unfavorable to dealers, and asserted that TrueCar was inducing dealers to sell cars at prices that were too low. Many of the comments urged dealers to discontinue their participation in TrueCar’s reverse auctions, and to terminate their dealings with TrueCar. During this period of time, the number of dealers participating in the TrueCar program, and the number of auto sales consummated using TrueCar’s websites, declined.
 
3. In February 2012, TrueCar announced that it was eliminating the reverse auction feature on its websites and narrowing the set of pricing and cost information that its sites would reveal to consumers. After TrueCar made these changes, numerous auto dealers resumed doing business with TrueCar. These changes may have made it more difficult for consumers to comparison-shop using TrueCar’s websites, thus relieving pressure on dealers to offer aggressive bids to consumers and possibly leading to retail price increases.

4. In connection with this investigation, on January 17, 2014, the Commission issued a Resolution Authorizing Use of Compulsory Process in Non-Public Investigation, File No. 131-0206. This Resolution authorized the issuance of Civil Investigative Demands (CIDs) to gather information about “whether firms in the retail automobile industry, including automobile dealers and industry consultants, may be engaging in, or may have engaged in, conduct violating Section 5 of the Federal Trade Commission Act, 15 U.S.C. §45, as amended, by agreeing to restrain competition, including by agreeing to refuse to deal with TrueCar, Inc.” Pet. Exh. 2 (Compulsory Process Resolution), at 1.
 
5. Respondent Ralph Paglia is a consultant who provides business advice and training to auto dealers regarding online marketing, lead generation, and related matters. He is President of Automotive Media Partners LLC, which has its principal place of business at 2701 N. Rainbow Blvd., Suite 2202, Las Vegas,
Nevada 89108.
6. Mr. Paglia writes frequently about online marketing and other topics of interest to auto dealers, and disseminates his writing through blog postings, comments on online social media networks, and publications on other online forums and websites. He also operates, manages, or moderates several such blogs, websites, and online social networks , including www.dealerelite.net, ralphpaglia.blogspot.com, www.automotivedigitalmarketing.com, www.automotivedigitaltraining.com, and automotivesocial.com. Many of the comments criticizing TrueCar’s business model and urging auto dealers not to participate in the TrueCar reverse-auction program appeared on websites and blogs that Mr. Paglia operates or administers. Moreover, materials on Mr. Paglia’s websites and blogs indicate that some industry consultants, dealer groups, and other businesses may have communicated with one another outside of the websites about matters relevant to this investigation.

7. Accordingly, the FTC staff believes that the investigation would be furthered by obtaining information that Mr. Paglia may have in his possession relating to the online communications, direct communications, and other activities at issue in the investigation. The FTC staff made a number of attempts to secure such information from Mr. Paglia on a voluntary basis, but Mr. Paglia declined to provide any information in response to the FTC staff’s inquiries.
 
8. On May 2, 2014, the Commission issued a CID (Pet. Exh. 3) requiring Mr. Paglia to produce specified documents and to respond to certain written questions. Specifically, the May 2 CID required Mr. Paglia to produce documents containing or relating to communications, correspondence, or meetings with TrueCar and auto dealers. The CID also sought documents, including blog posts, pertaining to the effect of TrueCar’s services on retail auto prices, auto dealers’ decisions on whether to stop participating in the TrueCar program, and Mr. Paglia’s role in operating and controlling the content of the relevant websites and blogs. Pet. Exh. 3, Schedule, Specs. 1-6.
 
9. The Commission sent the May 2 CID to Mr. Paglia via Federal Express on May 5, 2014, with a requirement that the package be signed for upon delivery. The Federal Express tracking receipt (attached hereto as Pet. Exh. 5) shows that the May 2 CID was delivered to Mr. Paglia’s address and signed for on May 7. The May 2 CID directed Mr. Paglia to produce the requested documents and information by May 21, 2014. See Pet. Exh. 3, at 1.
 
10. Mr. Paglia neither petitioned the Commission to quash or modify the CID, in accordance with the relevant statute and Commission rules, see 15 U.S.C. § 57b-1(f); 16 C.F.R. § 2.10, nor did he submit any objections to any of the specifications in the CID. Nonetheless, to date, Mr. Paglia has not produced any documents or information in response to the May 2 CID.
 
11. On June 18, 2014, the Commission issued a second CID to Mr. Paglia (Pet. Exh. 4), requiring him to appear and give oral testimony under oath at an investigational hearing to be conducted before me. The June 18 CID specified that this hearing would be held on July 10, 2014, at the Office of the United States Attorney for the District of Nevada, at 333 Las Vegas Boulevard South, Suite 5000, Las Vegas, Nevada 89101, commencing at 10:00 a.m. Pet. Exh. 4, at 1.
 
12. The Commission sent the June 18 CID to Mr. Paglia via Federal Express on June 23, 2014, with a requirement that the package be signed for upon delivery. The Federal Express tracking receipt (attached hereto as Pet. Exh. 6) shows that the June 18 CID was delivered to Mr. Paglia’s address and signed for on June 26. Commission staff also made informal attempts, by letter and email, to contact Mr. Paglia to discuss the upcoming investigational hearing. Mr. Paglia neither responded to this correspondence, nor filed any objections to the terms of the CID, nor petitioned the Commission to quash or modify the CID.The entire document comprising the FTC filing in Federal Court is available for download below:

Views: 1810

Tags: Car Dealers, Declined, Discovered by DC Reporter, FTC, Federal, Freedom of Speech, Investigation, Secret, Truecar

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Comment by Brian Bennington on September 28, 2014 at 7:27pm

Jeez Ralph, I'm sorry to read our omnipotent government has targeted you for, what sounds like, one of their overly zealous and mercilessly intimidating investigations.  Be careful.  They've been known to take everything their "offenders" have, including their dreams, and leave just the shell of a functioning, yet empty and broken human being.  Who knows, you may even be "targeted for termination!"

And, this is happening to a man who I just read was credited with the invention of the Internet.  (Oops!  Sorry, that was Al Gore.)  I meant to say credited with the first use of the Internet to sell cars.  (Really, I doubt you'd be in this if you had a lower profile, but because they are true believers in "The bigger they are, the hard they fall," you may find them "on you like last year's underwear!")  It's surprising they can find time to do it, considering government programs like the indenturing of our college-bound youth, that continues on unabated.  Or, as I've always maintained, "If you're looking for fairness, you've come to the wrong life."

I wish you luck absolving yourself of all charges.  Like me, most of your ADM members have little or no power to help you, but luckily there is a core of our membership with strong enough voices to be heard above the din of government prosecution.  I'm thinking of powerhouses like "Alpha Dawg" Jim Ziegler and the like.  The only thing I might suggest is that, if you plan to continue fighting this, you start a legal defense fund and solicit your ADM members for contributions.  If everyone kicked in ten or twenty dollars, you'd end up with over a hundred grand.  Enough at least for a few hours of consultation and a court appearance or two....               

Comment by Ralph Paglia on September 26, 2014 at 9:22pm

Many thanks to my friend David Ruggles for the link:

Insight: U.S. asks if car dealers ganged up on shopping website TrueCar

The Federal Trade Commission building is seen in Washington on March 4, 2012. REUTERS/Gary Cameron

The Federal Trade Commission building is seen in Washington on March 4, 2012.

Credit: Reuters/Gary Cameron

(Reuters) - It used to be that people in the market for a new car could go to the car-shopping website TrueCar.com, which collects bids from auto dealerships, and get dealers to undercut one another on price. Dealers could see the rival prices, so prices tumbled lower over time almost like a reverse-auction.

Faced with complaints from dealers over the way that worked, TrueCar changed its website, the system became less competitive, with dealers no longer seeing rival prices, and now U.S. antitrust enforcers are trying to unravel what happened.

The Federal Trade Commission is investigating whether car dealers across the United States ganged up against TrueCar, agreeing among themselves not to do business with the California-based Internet company because it was driving down prices, said people who have received letters from the FTC including TrueCar Inc chief executive Scott Painter.

TrueCar and dealers are now on good terms, but the FTC is investigating whether potentially higher prices from the company's changes were the result of fair market pressure or illegal collusion. The probe was disclosed in the auto trade press in September.

The investigation, which appears to be in an early stage, centers on an industry that is also feeling disruptive pressure from direct-to-consumer car-maker Tesla Motors Inc and on a company, TrueCar, that once had ambitions to make dealership staffs obsolete but which has since abandoned that idea.

Founded in 2005, privately held TrueCar provides price data to consumers for free and assists car-buying services like the one available to American Express Co members. It does not sell cars, but it projects that consumers will buy 400,000 vehicles this year with its help, up from 223,000 in 2012.

On Thursday, the company said it was getting a fresh $30 million injection from an investing arm of Microsoft Corp co-founder Paul Allen.

DATA LEADER

TrueCar is also a frequent source of sales data generally, quoted by news media including Reuters.

"We see all transactions across the U.S., both new and used," Painter said in an interview. The data allows the company to see, for example, how far people in a particular ZIP Code are willing to travel to buy a car, and what cars have sold for recently.

In earlier media interviews, Painter imagined a future in which customers would get a guaranteed low price online and then pick up a new car from a dealer without needing to talk to sales staff, let alone negotiate with them.

As the company gained momentum in 2011, a feature of its website began to get particular attention among dealers. They were allowed to see the bids that other dealers offered customers, and some dealers began to undercut prices so much they were willing to lose money on individual sales, hoping to make it back through service and repair work or future sales.

Adding to dealers' losses, they agreed to pay TrueCar $299 per sale on new cars and $399 per sale on used cars.

Complaints started showing up on online discussion boards. Jim Ziegler, a consultant to dealers who also writes columns about the industry, was the self-described catalyst.

"Are we so bad at what we do that we have to line up and pay vendors to lose money? And, who is giving these people access to your data that is used against you?" Ziegler wrote in a November 2011 column posted on several websites.

He advised dealers to cancel their affiliations with TrueCar. Many did. TrueCar said its network fell from 5,700 dealers at the end of 2011 to 3,100 two months later. Attacks came from other directions, too. These included accusations that TrueCar violated state franchise laws and had too much access to dealer-generated data.

Because dealers are the source of TrueCar's revenue, it also started to bleed money - losing $9 million in January 2012 alone. "They wanted us to die, go away," Painter said.

Taken off guard, TrueCar decided to make changes, among them the disabling of the feature that allowed dealers to see what rivals were bidding for potential customers. Dealers now see a customer's name, phone number, email address and what kind of car they are interested in buying. Customers see prices from area dealers.

COMPANY DEFENDS NEW SYSTEM

The company defends its new system, saying it would not have been able to survive if it had not changed.

"In order for an auction to theoretically work, you have to have willing participants. And we live in a free country, right?" Painter said. "If the outcome of a pure reverse-auction is unsustainably low prices that drive dealers out of business, that doesn't really work."

Besides, he said, price is only one factor for car-buyers and is often less important than location and giving them the exact car they want.

TrueCar began to court dealers back, telling them they were the company's customers as much as consumers were.

"We are not in the business of speculating on the business model of how cars are sold at the dealer level," Painter told Reuters this month. "That's up to them. Our job is to help dealers and consumers find each other and have the information to make a good match."

TrueCar's network has rebounded to 6,700 dealers, an all-time high, and the company is now a "genuine participant in the automotive ecosystem," Painter said.

As for what happened to prices after the turnaround, TrueCar does not have data on that, a spokeswoman said. One dealer, though, estimated that prices have risen to the point where he is making 30 percent more profit than he was at the height of TrueCar-induced competition when he saw rivals' prices and cut his accordingly.

"My prices are higher today than they were at the beginning of TrueCar," said Earl Stewart, who runs a Toyota dealership near West Palm Beach, Florida. "It's still a good buy for the consumer, but it's not as good as it was at the beginning."

Stewart, a member of TrueCar's Dealer Council, defends the company as embodying the free market. Other dealers urged him to stop using it in the earlier, more competitive period, he said.

"I had dealers call me and say, 'Let's stop this madness. Let's keep our prices at a reasonable level.' I said, 'You can't talk to me about that. You're going to go to jail. That's an antitrust violation,'" Stewart said.

Consumers can shop around as they always could if they want to put in the legwork to show quotes to other dealers.

FTC LAUNCHES PROBE

It is not clear how the episode came to the attention of antitrust enforcers, but in September 2013, dealers received letters from the FTC asking them to preserve documents.

The FTC said it was looking into whether some companies violated antitrust laws "by agreeing to refuse to deal with TrueCar" in 2011 and 2012, according to Automotive News, a trade publication that got a copy of one letter.

Ziegler, the industry columnist, got a letter from the FTC, too. In an interview, he said he would cooperate but that the FTC was ridiculous for starting a probe so long after TrueCar and the dealers had resolved their differences. "If they had done this when it was a hot issue, it would make a lot more sense," he said.

Even now, he added, the investigation is unwarranted because dealers did not collude. He said they cut ties out of their own self-interest to stay in business.

"I know a lot of dealers canceled them, but it was all individual decisions," he said.

It was unclear how many dealers have received letters from the FTC. The National Automobile Dealers Association, a trade group, said it received one and is cooperating but does not believe it is a target.

An FTC spokesman declined to comment.

Investigations into concerted action are often straightforward, said Seth Bloom, a former Justice Department antitrust lawyer now in private practice in Washington, D.C. "If they can find an agreement among competitors not to deal with this distribution channel, it's basically a case right there," he said.

If the FTC were to find that there was anti-competitive behavior, it could order TrueCar to restore its former business practices or search for other remedies, Bloom said.

Painter expressed ambivalence about the FTC's investigation. He said TrueCar did not request it, is not a target and is paying fees to two law firms, Alston & Bird and Wilson Sonsini Goodrich & Rosati, to comply with it.

He said he had no opinion on whether the dealers violated laws meant to protect competition.

"If it's determined that there was a perpetrator and a victim, we're the victim," he said, "but I think that we as a company have already survived this issue, so I don't know what you could do to help the victim."

With TrueCar having changed, he added, "dealers are back on the program, so we have no interest in picking any fights."

(Reporting by David Ingram; Editing by Howard Goller and Ken Wills)

Source: http://www.reuters.com/article/2013/12/17/us-usa-antitrust-truecar-...


Influencer
Comment by Sherm Stevens on September 26, 2014 at 9:48am

Right on the money, Ken. Did you know that labor unions have all sorts of exemptions from many of the laws our businesses (and we) are supposed to follow?

http://www.nrtw.org/d/big_labor_special_privileges.htm

Folks, this is a call to action. We need to be sure we wrest control of the Senate away from Harry Reid in November or there may be no recovery from this socialist assault.


Influencer
Comment by Ken Leib on September 26, 2014 at 8:50am

Who declared the era of big government over? It puzzles me how business people exercising their "right to choose" to do or not do something is collusion, however when unions encourage their membership to stop working at different manufacturers and threaten to hurt people crossing their picket lines, that is not collusion. 

Comment by Don Ruguleiski on September 26, 2014 at 7:18am

This is madness. We just dropped Trrue Car for the second time. The race to the bottom still exists. I think we as consumers (Dealers) still have the right to choose which vendors work for our business model. If True Car doesn't work for us, who has the right to tell us or force us to use them? Wow!

Comment by Tom Gorham on September 26, 2014 at 6:23am

Whatever happened to freedom of the press?  I'm assuming you have an attorney who advised you not to respond.  I'm a little baffled as to how TrueCar can be seen as a competitor to dealers since they are a dealer provider, hired by dealers.  Don't consumers (in this case dealers are the consumers of TrueCars services) have a right to communicate dissatisfaction with a company's products or services?


Influencer
Comment by Sherm Stevens on September 26, 2014 at 6:06am

Jeez. This sounds like a script or chapter out of Ayn Rand's 'Atlas Shrugged.'

I'm just curious who initiated this inquiry? Does Truecar have friends in high places? Are they obowmao/holder minions?

This is similar in nature to the real estate business. I sold houses in the 80's... and one thing my broker pushed in training over and over again was to never discuss commissions with anyone outside the company, otherwise the FTC would consider it 'restraint of trade' and price fixing. Stupid then, stupid now.

Comment by David Ruggles on September 26, 2014 at 5:46am

Bravo Ralph!  What exactly does the FTC think happened? 

There will be an article on Truecar published in the next issue of Inc. Magazine, a follow up to the following:

http://www.inc.com/bill-murphy-jr/how-truecar-saved-itself.html

You might recognize some of the people quoted.

Comment by Jason Mickelson on September 26, 2014 at 5:31am
You are veryan intelligent Ralph and so you surely have hired a fantastic legal council. It appears that you are battling the law and they usually win. One question, what happened to freedom of speech?
Comment by Martin Logsdon on September 26, 2014 at 4:43am

SCREW'M RALPH

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