African Americans and Latinos Auto Discrimination Class Action
In the nationwide class action litigation against TMCC, American Honda and WFS Financial, the respective parties entered into landmark settlements for African American and Latino consumers which collectively provided:
- Cash or credit payments of up to $400 per class member.
- Broad refinancing programs reducing rates charged to existing African-American and Latino customers whose markups were 1% or more. These benefits were valued at $1 billion in the WFS Financial case alone.
- New pre-approved offers of credit (that cannot be marked up) to 1.5 million African American and Latino consumers.
- Limits on discretionary markups on new loans of 1.75% to 2.50% (depending on the length of the loan). This compression of the discretionary range substantially reduced the likelihood that any markups in the future will occur as the result of racial discrimination.
- New disclosures on all contracts explaining that the interest rate may be negotiable.
- Donations of $1.9 million to non-profit organizations involved in consumer education and assistance.
In approving the settlement in WFS Financial, the Court recognized the "innovative" and "remarkable settlement" achieved on behalf of the nationwide class.
The last case resolved was Herra v. Toyota Motor Credit Corporation. In November 2006, the Court granted final approval to a nationwide class action settlement on behalf of all African-American and Hispanic customers of TMCC who entered into retail installment contracts that were assigned to TMCC from 1999 to 2006. The monetary benefit to the class was estimated to be between $159 and $174 million. Michael W. Sobol managed the litigation for Lieff Cabraser.
Further information is available at www.ecoa-settlement.com.
About Lieff Cabraser
Lieff Cabraser Heimann & Bernstein, LLP is a fifty-plus attorney law firm that has represented plaintiffs nationwide since 1972. We have offices in San Francisco, New York and Nashville. We represent plaintiffs in class and group actions and in individual lawsuits in cases involving substantial losses. For the last five years, the National Law Journal has selected Lieff Cabraser as one of the top plaintiffs' law firms in the nation.
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