$3.1 Million Jury Verdict in Business Fraud case

After a three week trial, a Sacramento County jury found Westlake Financial Services, a major Los Angeles car loan company, guilty of fraudulent lending practices, and awarded a Sacramento Dollar Rent a Car franchise over $400,000 in damages plus $2.7 million in punitive damages.  “The jury found that Westlake induced Dollar to enter into contracts by making false representations, overcharged interest, assessed unwarranted late charges, and failed to give credit for many monthly payments,” said Dollar’s attorney, Jeffrey H. Ochrach of Roseville.

 

The litigation stemmed from breaches of agreements under which Dollar bought and financed fleets of rental cars with Westlake.  Under their contracts with Dollar, Westlake was required to buy back most of these cars, thereby paying off the balance on the loan.  But Westlake refused to honor its contracts and then sued Dollar on the loans Westlake failed to pay off.  This dispute took five years to get to trial.  At trial, Westlake introduced many documents that Dollar asserted were highly questionable: “After five years of litigation, Westlake ‘found’ invoices, checks and other documents it somehow couldn’t find when we asked for them before trial.  These documents were supposed to help their case, but I think the jury recognized that Westlake fabricated these documents during trial and it cemented the notion that these guys were untrustworthy,” said Mr. Ochrach.

 

“One of the things that makes this case so satisfying is that Westlake sued Dollar for about $1 million, claiming enormous amounts of interest, late fees of $140,000 and denying receipt of hundreds of thousands of dollars in payments.  But the jury waded through all of the accounting evidence and determined that Dollar had fully paid these loans – in fact, Dollar overpaid.”  Mr. Ochrach commented, “I explained to the jury that the only way to stop this kind of fraud is to hit Westlake with a verdict that catches the attention of Westlake’s shareholders and the public.”  The jury’s message was loud and clear.