Caliber Files Lawsuit Over State Regulators

January 24, 2003

In a lawsuit filed in the Los Angeles Superior Court recently, Irvine-based Caliber Collision Centers asked the court to compel the Bureau of Automotive Repair to stop engaging in a regulatory practice that is “unlawful” and denies Caliber and other businesses their constitutional rights to due process.

According to the lawsuit, the Bureau has routinely issued citations for purported violations of the Automotive Repair Act without the legal authority to do so. Although the citations were typically issued for technical or administrative violations of the Bureau’s regulations or for mistakes that were attributable to bona fide human error, they were posted on the Bureau’s Web site as “confirmed violations” of the Act. These postings were made despite the fact that Caliber and other automotive repair dealers were never given an opportunity to contest them.

As a result of the Bureau’s practice, and as stated in Caliber’s lawsuit, “Caliber has been forced to defend itself from frivolous and extortionate lawsuits filed under Business & Professions Code §17200, which have been brought solely because the Bureau has posted the unchallenged allegations contained in the citations on its Web site and has illegally characterized them as ‘confirmed violations’ of the Act.”

At the heart of Caliber’s lawsuit is a complaint that the company’s due process rights have been violated and its reputation has been damaged as a result of receiving citations that are based on nothing more than “technical violations” but that are characterized as something far worse on the Bureau’s Web site. Caliber chairman and CEO Matthew Ohrnstein stated: “The real problem is not just that the citations were issued unlawfully but that the regulations fail to make important distinctions between minor technical violations or reporting mistakes and more serious violations that really hurt consumers. As a result, automobile repair companies doing business in California are being treated unfairly. This lawsuit points out the need for genuine regulatory reform in the industry.”

According to Marty Keller, executive director of the Automotive Repair Coalition (ARC), a non-profit organization representing over 10,000 registered automotive service providers in California, “The issues that Caliber is asserting in its writ of mandate are the same issues experienced by automotive service providers throughout the state. The Bureau’s illegally issued citations and the lack of due process threaten the entire automotive repair industry in California. The ARC supports Caliber’s efforts and will work closely with the legislature to effect meaningful regulatory reform.”

Caliber’s petition asks the superior court to issue a “writ of mandate,” which is a court order to the Bureau to follow the requirements of the agency’s authorizing legislation to establish an appropriate regulatory regime for enforcing the statute, and to quash or rescind all citations that have been illegally issued. Caliber has expressed its strong desire to cooperate with the Bureau of Automotive Repair to achieve the regulatory reform that is needed.

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