Auto Finance Company Sues Massachusetts City Over Its Unconstitutional Sale Of Seized Vehicles

from the money-v-power dept

An opponent of asset forfeiture has arisen from an unexpected place. Honda's finance division has taken the city of Revere, Massachusetts to court over the seizure and sale of a vehicle it still technically owned.

American Honda Finance Corp., based in California, alleged in its lawsuit filed Feb. 12 in U.S. District Court for the District of Massachusetts that its constitutional rights were violated when a Honda Civic was seized in 2016 by Revere's police department.

"Plaintiff brings this action to remedy a deprivation of its long-settled and fundamental rights to be free from unreasonable seizures and to due process of law under the United States Constitution," American Honda Finance Corp. said in its 13-page complaint.

The complaint [PDF] makes it clear the company thinks this is some bullshit: seizing and selling a vehicle that still belongs to the company holding the lien. Until the vehicle is paid off, Honda still owns the car. But Massachusetts law enforcement doesn't appear to care who owns the car so long as they get to profit from its sale. The narrative detailed in the lawsuit makes it clear zero effort was made to make the car's real owner aware of the city's plans for the seized car.

On or about November 2, 2016, HONDA obtained a purchase money security interest and lien in The Subject Vehicle.

On November 28, 2016, The Subject Vehicle was officially titled in the State of New York with Shanasia Hackworth recorded as the owner and HONDA recorded as the first priority lienholder.

On or about December 30, 2016, REVERE took possession and custody of The Subject Vehicle pursuant to REVERE’s police officers acting in the course of their duties as law enforcement officers.

On or about December 30, 2016, REVERE, through its police officers acting in the cause of their duties as law enforcement officers, and pursuant to laws enacted to further official state interests, directed Mario’s Service Center, Inc. to tow and detain The Subject Vehicle.

On or about December 30, 2016, Mario’s Service Center, Inc. towed The Subject Vehicle and retained The Subject Vehicle on behalf of REVERE as part of an “investigation.”

REVERE did not notify HONDA that The Subject Vehicle had been seized.

REVERE thereafter concluded its investigation. REVERE did not, thereafter, return The Subject Vehicle to HONDA or anyone else. Instead, REVERE authorized its agent, Mario’s Towing Service Center, Inc., to detain and dispose of the vehicle pursuant to Massachusetts G.L.c. 255, §39A.

REVERE did not notify HONDA that after the investigation ended that REVERE authorized Mario’s Towing Service Center, Inc. to detain and dispose of The Subject Vehicle.

REVERE did not ensure that its agent, Mario’s Towing Service Center, Inc., notified HONDA that REVERE had authorized detention and disposal of the Subject Vehicle.

On or about May 18, 2017, REVERE’s agent, Mario’s Towing Service Center, Inc., sold The Subject Vehicle and The Subject Vehicle was retitled through the Massachusetts Department of Transportation with HONDA’s lien not recorded on said title.

Under Massachusetts law the sale pursuant to Massachusetts G.L.c 255, §39A and subsequent retitling extinguished HONDA’s property interest in The Subject Vehicle.

At no time prior to the sale or retitling of The Subject Vehicle did REVERE or any person provide any notice to HONDA relating to The Subject Vehicle.

There's a genuine question of property interest in a vehicle whose title still resides with the financing company. This can't be the first time a company has complained about a vehicle of theirs being auctioned off without notice, but this is the first federal complaint I've seen directly challenging a state's seizure of vehicles from drivers who don't actually own the vehicles they're driving.

This was filed ten days before the Supreme Court held that certain forms of asset forfeiture violate Constitutional protections against excessive fines. Honda's complaint seems to anticipate the high court's displeasure with abusive forfeitures and pulls no punches in its description of the program the city of Revere participate in. (Emphasis in the original.)

Massachusetts G.L.c. 255, §39A effectuates the Commonwealth’s interest in enforcing traffic laws and in protecting the public from hazardous street conditions. The statute provides a means for the state to compensate private parties who assist the state by towing and storing vehicles at the direction of police. The statute has, however, fallen out of step with modern developments in constitutional law which confirm that a duly perfected security interest and lien in a vehicle is a constitutionally protected property right.

A program that takes property away from the property's true owner -- an entity completely disconnected from the underlying criminal activity/accusations -- appears to be a violation of the company's Constitutional rights, if not the greater protections given to property owners by the state's constitution. The suit alleges a host of violated rights, as well as conversion under state law, arguing the sale of the vehicle without notifying the lien holder is basically theft of Honda's property.

Is it going to take the deep pockets of pissed off corporations to finally make a serious dent in abusive forfeiture programs? It might. This case may be more tow-and-sell than most forfeitures, but the principle behind it -- the state depriving companies of their property without notice -- is identical. If this case adds to the judicial dialog on forfeiture programs, I'm all for it.

Filed Under: asset forfeiture, cars, leasing, massachusetts, ownership, theft
Companies: honda

Honda Tried To Get Jalopnik To Dox Commenter, Delete Posts, Meets The Streisand Effect Instead

from the hi-honda dept

Criticism is part of life, of course, and I tend to believe that people show their true selves most transparently when they show how they deal with criticism. Unfortunately, we've covered entirely too many stories involving people and companies responding to online criticism poorly here at Techdirt. Typically, these unfortunate responses amount to trying to censor the criticism, but it can more dangerously involve the attempted silencing of journalism as well as threats of legal action against those making the critical comments.

Too many times, websites and web services cave to this sort of censorship. But not everyone. Gawker Media, about whom I could fill these pages with criticism, appears to be pushing back on once such attempt levied against its site Jalopnik. Apparently, car-maker Honda took a negative view of some comments made at the site, purportedly by a Honda employee. For some reason, Honda decided that this distinction meant that it could not only silence the comments, but that it should receive help from the site in outing the commenter. The whole thing starts off, as seems so often the case, with some rather mild criticism in the form of a comment.

In December, a commenter calling him or herself HondAnonymous, posted a string of comments on these posts claiming to be a technician at Honda’s research and development facility. People on the Internet make claims like that all the time, but HondAnonymous seemed able to back them up with actual information about the development of the NSX and other cars. The most interesting bits were complaints about the NSX’s Continental tires (“they are garbage”) and how newer Honda engines have an issue “with the studs on the cat either backing out of the head or snapping altogether.”

Interesting, if not earth-shattering. A lot of it sounds like normal car development. The first one is a complaint we’ve seen in various early NSX tests, and the last is probably a recall waiting to happen. But earlier this month, Honda’s lawyers contacted us to say that information posted by HondAnonymous “is confidential information owned by Honda R&D Americas, Inc., and posts by that user of such confidential information breaches a contractual obligation of confidentiality owed to Honda R&D Americas, Inc.”

As Jalopnik notes, it wasn't them that posted the information. Instead, it was a commenter within the open commenting system Gawker Media uses. Regardless, apparently Honda's attorneys requested not only that all comments by the user be taken down immediately, but they also requested that the site turn over all identifying information about the user to them so that they could hunt down the leak. Think about this for just a moment and you'll see the problem: Honda wants Jalopnik's help in figuring out who this commenter is, while also demanding that the content be taken down because it violates a contractual confidentiality agreement. However, Jalopnik isn't obligated in any way to help Honda, regardless of what private contracts may or may not have been violated.

In typical Gawker fashion, Jalopnik gleefully is posting about all this, Streisanding the issue back into the news when it might otherwise have died off quickly.

It’s pretty egregious for a corporation to try to bully a news organization into deep-sixing comments from its own readers. It’s far more egregious to threaten to subpoena us if we don’t dox one of those readers. The good news is we couldn't dox HondAnonymous even if we somehow wanted to. He or she used an anonymous burner account, and we don’t track passwords, logins, or IP addresses for any of our users. HondAnonymous’ posts will stay up.

To Honda, or any other automaker: If you would like us to delete the comments of our readers or expose their identities (which, again, we can’t do anyway) again, please let me know! I am more than happy to drag your intimidation tactics into the public eye for all your customers and prospective buyers to see. Govern yourselves accordingly.

So, in trying to silence and out a critic, Honda instead finds themselves the subject of reports about the attempted silencing of the critic, whose criticism is once more in the public light. Bang up job, lawyers!

Filed Under: anonymity, comments, contracts, doxxing, jalopnik, news sites, streisand effect
Companies: gawker, honda

Seattle Honda/Toyota Dealer Decides To Try To Sell Cars Like Tesla Does, Rather Than Trying To Shut Tesla Down

from the that's-one-step dept

Over the past few years, we've highlighted how frightened autodealers have absolutely freaked out about the way in which Tesla sells its cars. If you don't know, rather than having a bunch of independent dealers, Tesla sells direct, where you mainly buy via its website. Rather than dealerships, Tesla has showrooms where you can go check out the cars. The pricing is clear and obvious and it's much lower pressure. Dealers have tried a variety of tricks to actually outlaw Teslas from being sold in their states, even arguing that Tesla's website is illegal. Thankfully, most states aren't falling for this, and even the FTC has supported the Tesla way of selling cars.

Apparently, some dealers are finally realizing that if you can't beat 'em by trying to make them disappear, perhaps you ought to compete. Via Jalopnik, we learn of a dealer in Seattle (who owns both a Honda and a Toyota dealership) who has decided to adopt what he thinks is the "Tesla model" for selling cars -- single price, no haggling, no separate finance department whose there to screw you over on the deal terms, and transparency about the loan rates.

What's more, the dealerships have no F&I managers. Salespeople handle the loans. Learning to do that isn't easy, so Miller and Mohammadi have hired contractors to do some paperwork and walk the salespeople through the process.

Prices are fixed, and so are interest rates. Customers who need financing can refer to a chart on the wall, tracing their finger from their credit score to the amount of the loan.

Of course, the story also notes that this shift hasn't been easy. Most of the existing sales staff left as they couldn't deal with this setup, and sales at the dealership dropped significantly -- though they've since rebounded. And, of course, there have been other dealers in the past that have adopted "one price/no haggling" setups, but studies have shown that many customers don't trust such deals, assuming that the "one price" is likely to be higher than they could get by negotiating, even if they don't like haggling.

While I think it's a smart move to try to compete, rather than ban, innovative competitors like Tesla, it feels a little bit like a cargo cult copying situation, where the focus is on copying the obvious superficial aspects of what Tesla is doing, but not the deeper hidden reasons. In Tesla's case, it's a combination of factors that are selling those cars, including the cool factor, the environmental factor and the overall prestige of the car. Hondas and Toyotas, while recognized as reliable, don't have all of those factors. Plus, since the Tesla sales model is for all Teslas, there is no other option, so no one feels that the single price offering is a rip off. That's not the case when a single dealer does something.

So I think it's good that this dealer is looking for a better model, but it's going to involve a lot of experiments and innovating, beyond just copying some of the superficial aspects of what Tesla does.

Filed Under: auto dealers, car dealers, cargo cult, competition, dealers, haggling, innovation, sales, superficial
Companies: honda, tesla, toyota

DailyDirt: Personal Mobility Solutions That Solve Non-Problems Look Cool

from the urls-we-dig-up dept

The Segway never really lived up to its hype, but it does serve a practical purpose as a means of transportation -- and it's a bit more convenient than a bike in some ways. (I haven't been a fan of larger versions of the Segway (GM's PUMA) because some things just don't scale well. However, I'm not against tinkering with new transportation solutions to try to come up with cool new ways to get around.) If you like transportation gadgets, here are just a few cool-looking projects that offer some extreme maneuverability.

• The RYNO is a motorized unicycle that behaves like a Segway (with one less wheel). It has a top speed of 10 mph, but it doesn't quite look as dorky as a Segway. [url]
• If being able to turn on a dime is your goal, then an omnidirectional bike with two spheres for wheels might be the gadget for you. The Spherical Drive System is only a prototype, but it literally puts a new spin on the wheel. (This bike might actually look cooler if it had a third sphere...) [url]
• Honda has developed its own unicycle called the UNI-CUB personal mobility device. It has a cumbersome name, but it sports an omnidirectional driving wheel system (aka Honda Omni Traction Drive System) and looks fairly compact and maneuverable for indoor use. [url]

If you'd like to read more awesome and interesting stuff, check out this unrelated (but not entirely random!) Techdirt post via StumbleUpon.

Filed Under: bike, omnidirectional, personal mobility, puma, ryno, segway, spherical drive system, transportation, uni-cub, unicycle
Companies: gm, honda

DailyDirt: Weird Airplane Designs

from the urls-we-dig-up dept

Airplane designs have evolved quite a bit over the years. Some new planes might as well be alien spacecraft compared to the designs most people recognize. Outside of the super secret stealth aircraft, though, there are some interesting planes that are more fuel efficient and have strikingly different silhouettes. Here are just a few examples.

• Honda has a luxury jet, Hondajet, going into commercial production. Hondajet's engines are mounted in an unconventional way -- sitting on pedestals above each wing. [url]
• More fuel efficient plane engines could incorporate open rotor designs. Open rotor engines can have pretty large diameters and not require heavy shielding... and they look cool. [url]
• This fuel efficient concept combines a fuselage that provides some lift along with rear-mounted engines. Placing two engines right next to each other in the rear might be a problem if one of them fails and takes out the only other engine on this plane. [url]

If you'd like to read more awesome and interesting stuff, check out this unrelated (but not entirely random!) Techdirt post via StumbleUpon.

Filed Under: airplane, aviation, engine design, fuel efficient, hondajet, jets
Companies: honda

DailyDirt: More Walking Robots

from the urls-we-dig-up dept

Honda's ASIMO and other walking robots don't really look like much of match for catching up with people running away from them. But like zombies, robots never get tired and can just keep walking slowly towards you (as long as their batteries last, that is). Here are just a few examples of some robots that are starting to walk a bit more like us.

• Boston Dynamics has been working on a 6'2" tall humanoid robot named Atlas. It can walk over rubble, and someday it will say, "I'll be back" in an Austrian accent. [url]
• Researchers at the Humanoid Robotics Institute have designed a robotic leg with many of the same joints and features of a human leg. It's actually not that easy to get a robot leg to have all the same range of motions as a real human leg. [url]
• Robot legs using a neural network to mimic human walking has created one of the first biologically-accurate models of the human gait. This research could help us understand how babies learn to walk and how people with spinal cord injuries might learn to walk again. [url]

If you'd like to read more awesome and interesting stuff, check out this unrelated (but not entirely random!) Techdirt post via StumbleUpon.

Filed Under: asimo, atlas, biomimicry, bipedal, gait, humanoid, locomotion, mabel, robots, terminator, walking
Companies: boston dynamics, darpa, honda, humanoid robotics institute

DailyDirt: Ads Are Content

from the urls-we-dig-up dept

One of the recurring themes around here is that advertising should be engaging and entertaining, not annoying. Every year, there are excellent examples of this truism -- during the halftime of the Superbowl. Some ads are easily forgotten, but some are remembered for decades (and even associated with the products they were trying to promote). Here are just a few more reminders, just in case you're busy this coming Sunday.

• Apple's classic "1984" superbowl ad seems to be one of the few things remembered from that game's advertising. Who are the "drones" now? [url]
• The Sausage King of Chicago is back selling Japanese-made SUVs. Save Ferris! [url]
• Freaking people out with (fake) flying people in the skies of NYC... is supposed to get people to watch a movie? Possibly viral? Check. Is this obviously connected to the product being advertised? Uh... [url]
• To discover more interesting advertising-related content, check out what's floating around on StumbleUpon. [url]  

By the way, StumbleUpon can recommend some good Techdirt articles, too.

Filed Under: 1984, ads, chronicle, ferris bueller
Companies: apple, honda

Honda Sued For Trademark Infringement For Suggesting It Wants To Save The Earth

from the okay,-don't-save-the-earth dept

Be careful suggesting that you want to "save the earth." Automaker Honda just did that in an ad with a guy wearing a "save the earth" t-shirt, and for doing so, it got slapped with a trademark infringement lawsuit from the Save the Earth Foundation, which apparently has a trademark on that phrase (and has had it since 1972). The foundation claims that the ad was implying endorsement by the foundation. I wonder if morons in a hurry have any interest in saving the earth.

Filed Under: advertising, cars, save the earth, t-shirts, trademark
Companies: honda, save the earth foundation