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1523101
UNITED STATES OF AMERICA
BEFORE THE FEDERAL TRADE COMMISSION
COMMISSIONERS: Edith Ramirez, Chairwoman
Maureen K. Ohlhausen
Terrell McSweeny
)
In the Matter of )
) DOCKET NO. C-4596
General Motors LLC, )
a limited liability company )
)
COMPLAINT
The Federal Trade Commission, having reason to believe that General Motors Company
(“Respondent” or “GM”) has violated provisions of the Federal Trade Commission Act (“FTC
Act”), and it appearing to the Commission that this proceeding is in the public interest, alleges:
1. Respondent is a Delaware limited liability company with its principal office or place of
business at 300 Renaissance Center, Detroit, MI 48265. Respondent has marketed and
advertised for sale used GM motor vehicles.
2. The acts or practices of Respondent alleged in this complaint have been in or affecting
commerce, as “commerce” is defined in Section 4 of the FTC Act, 15 U.S.C. § 44.
3. Since at least November 2014, Respondent has disseminated or has caused to be
disseminated advertisements promoting the sale of “Certified Pre-Owned Vehicles.”
Respondent establishes criteria for certifying pre-owned vehicles, which are then
inspected and sold by Respondent’s local dealerships. Respondent provides consumers
a 12-month/12,000-mile “bumper to bumper” warranty for each Certified Pre-Owned
Vehicle.
4. Respondent’s advertisements for Certified Pre-Owned Vehicles include, but are not
necessarily limited to, advertisements and marketing materials posted on the website
www.gmcertified.com, excerpts of which are attached as Exhibits A through F. On this
website, Respondent advertises Certified Pre-Owned Vehicles that are available at its
affiliated local dealerships by, among other things, allowing consumers to search for
individual cars and providing descriptions of these cars.
5. Respondent’s advertisements on its website have included the following claims
regarding its Certified Pre-Owned Vehicles:
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“We check it, so you don't have to.
172-Point Inspection and Reconditioning
Our detailed, 172-Point Vehicle Inspection and Reconditioning Process is one of
the most comprehensive in the industry. Before any Chevy, Buick, or GMC used
vehicle earns the title of Certified Pre-Owned, it must first meet all of our
rigorous standards.
Our 172-Point Vehicle Inspection and Reconditioning Process is conducted only
by highly trained technicians and adheres to strict, factory-set standards to ensure
that every vehicle’s engine, chassis, and body are in excellent condition. The
technicians ensure that everything from the drivetrain to the windshield wipers is
in good working order, or they recondition it to our exacting standards. The
vehicles are road-tested, put up on a lift for a complete underbody and frame
inspection, and then completely checked for any cosmetic flaws.
And we do check it all. From the engine block to the shocks, right down to the
floor mats, no major system is overlooked. If it fails a single point, we completely
recondition it – or it won’t be Certified.”
Exhibit A.
6. Respondent also provides on its website a checklist of all items that its local dealers
review as part of Respondent’s 172-point inspection. This checklist includes “open
recalls”:
REVIEW
T
H
E
VEHICLE’S
H
IS
TORY:
PA
SS
FA
I
L
. . .
Open
R
ecalls
Exhibit B.
7. Even though it has made the claims set forth in Paragraphs 5 and 6, until at least June
2015, Respondent has advertised on its website numerous Certified Pre-Owned vehicles
available at its local dealerships with open recalls for safety issues.
8. In some instances, these open safety recalls have included recalls for defects that can
cause serious injury. For example, Respondent has advertised Certified Pre-Owned
vehicles that have an open safety recall for a key ignition switch defect, which can affect
engine power, power steering, braking, and airbag deployment, thereby increasing the
risk of a crash and occupant injury. Respondent also has advertised Certified Pre-Owned
vehicles that have an open safety recall for a defect associated with the body control
module connection system, which can result in a variety of issues with the brakes that
may increase the risk of a crash. Respondent also has advertised Certified Pre-Owned
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vehicles that have an open safety recall for a defect associated with the chassis electronic
module, which can cause engine stalls, thereby increasing the risk of a crash.
9. In numerous instances, until at least June 2015, when Respondent has advertised
Certified Pre-Owned vehicles that are subject to open recalls for safety issues making the
claims set forth in Paragraph 5 and 6, it has provided no accompanying clear and
conspicuous disclosure of this fact.
10. When consumers search for particular categories of vehicles on Respondent’s website,
there is no disclosure of open safety recalls. An example of such search results includes
the following:
Exhibit C.
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11. When consumers have viewed specific vehicle listings on Respondent’s website, there is
no disclosure regarding open safety recalls. An example of a listing for a Certified Pre-
Owned vehicle with an open safety recall includes the following:
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Exhibit D.
12. Another example of a listing for a Certified Pre-Owned vehicle with an open safety recall
appears as follows:
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Exhibit E.
13. In some listings for Certified Pre-Owned vehicles, such as the example shown in
Paragraph 12, there is a line that reads “CARFAX Vehicle History Report.” Underneath
that line, Respondent provides a “preview” of the vehicle history report. If a consumer
were to locate this information, understand that one could click on the line reading “Get a
Free CARFAX Vehicle History Report” to access additional information, and click on
the line, a vehicle history report potentially containing information about an open safety
recall would appear.
14. In many instances in which a Certified Pre-Owned vehicle is subject to an open safety
recall, such as the example shown in Paragraph 12, GM’s preview of the vehicle history
report has excluded that information.
15. In contrast, in many instances in which a Certified Pre-Owned vehicle has no open safety
recall, GM’s preview of the vehicle history report includes that information. An example
of such a listing includes the following:
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Exhibit F.
VIOLATION OF THE FEDERAL TRADE COMMISSION ACT
Count I
16. In connection with the marketing or advertising of used GM motor vehicles, Respondent
has represented, directly or indirectly, expressly or by implication, that used motor
vehicles it advertises have been subject to rigorous inspection, including for safety issues.
17. In numerous instances in connection with the representation set forth in Paragraph 16,
Respondent has failed to disclose, or disclose adequately, that used vehicles it advertises
are subject to open recalls for safety issues.
18. Respondent’s failure to disclose, or disclose adequately, the material information set forth
in Paragraph 17 above, in light of the representation described in Paragraph 16, above,
constitutes a deceptive act or practice in or affecting commerce in violation of Section
5(a) of the FTC Act, 15 U.S.C. § 45(a).
THEREFORE, the Federal Trade Commission, this eighth day of December, 2016, has
issued this complaint against Respondent.
By the Commission.
Donald S. Clark
Secretary
SEAL:
