Safetyforum.com: NC Documents Reveal DaimlerChrysler's 'Massive' Lemon Laundering

    ARLINGTON, Va., March 16 DaimlerChrysler's public image is
severely tarnished by documents made public by a North Carolina court that
reveal the cold efficiency of the company's program to buy back and recycle
vehicles with a troubled history, a process known as "lemon laundering."  The
documents reveal that Chrysler paid $1.3 billion to buy back more than 50,000
vehicles from 1993 through 2000.
    The release of the documents is "a great victory for consumers in America
who were defrauded by DaimlerChrysler," according to Doug Abrams, an attorney
suing Chrysler on behalf of a North Carolina couple who unknowingly bought a
recycled lemon. Abrams is a partner in Twiggs, Abrams, Strickland and Rabenau,
a Raleigh, N.C. firm that are Safetyforum.com's first "Attorneys of Record"
for Lemon Litigation.
    "These documents establish for the first time the extensive corporate-
level involvement in a process that historically had been dismissed as the
misbehavior of a few rogue dealers.  Now we're beginning to learn the truth of
Chrysler's extensive involvement," said Ralph Hoar, director of
Safetyforum.com, where some of the documents are posted.
    "From a review of these documents we conclude that this misconduct by
DaimlerChrysler is merely a part of its business plan," Abrams said. The
three-inch stack of DaimlerChrysler documents came to light because they were
in a notebook referred to by a Chrysler lawyer while appearing as a witness in
the case.  Wake County Superior Court Judge Narley Cashwell ordered the lawyer
to turn over the documents, setting off a two-day scramble by Chrysler to get
the documents sealed.  Earlier this week the North Carolina Court of Appeals
vacated a temporary stay that it had placed on the documents in February.
    Abrams maintains that, "Chrysler has not produced the first single
document in response to Judge Cashwell's specific orders specifying documents
DaimlerChrysler is required to produce."
    Among other things, the documents reveal that DaimlerChrysler generally
recovers close to 70 percent of the buyback price by auctioning most of the
troubled vehicles to DaimlerChrysler dealers who resell them to the public.  A
few of the vehicles are crushed or "donated." Among the documents are
disclosure forms that are supposed to be signed by new owners to acknowledge
they are aware of the vehicle's troubled history.  The forms are frequently
not signed.
    The case, filed in 1999, has been marked by DaimlerChrysler's repeated
refusal to produce documents as the court has ordered.  Since December 11,
2000, the company has accumulated more than $325,000 in sanctions.  In
January, Judge Cashwell, faced with the automaker's refusal to comply with
four separate orders calling for the production of documents, penalized
DaimlerChrysler with a default judgment, meaning that it will not be allowed
to mount a defense in the case.
    Last year, the court ordered Chrysler to produce underlying cost documents
related to its buyback program.  In a hearing before Judge Cashwell, Chrysler
attorney R. Jonathan Charleston told the court that the underlying cost
documents had been produced under seal.  "Our review revealed that
DaimlerChrysler did not produce the underlying cost documents," Abrams said.
"We have reminded Mr. Charleston of his representations to the court. We have
asked the judge to hold Chrysler in contempt and to bring Chrysler's president
and CEO to Raleigh to explain Chrysler's repeated refusal to comply with
orders of North Carolina courts," he added.  Abrams has asked the court to
increase DaimlerChrysler's sanctions to $20,000 a day until they produce the
documents as ordered by the court.  "The current level of sanctions have had
no impact," he said.
    "Chrysler continues to flaunt its complete disregard for valid orders of
the superior court.  Judge Cashwell is well recognized as a courageous and
insightful judge.  In our view, Chrysler remains in contempt of court," Abrams
said.
    Copies of the Chrysler documents are available from Safetyforum
Research. 703-469-3700.

    http://www.safetyforum.com

    Contact:
    Doug Abrams
    Twiggs, Abrams, Strickland and Rabenau
    919-828-4357

    Ralph Hoar
    Safetyforum.com
    703-469-3700