PITTSBURGH – A Pennsylvania man who alleged that a leading automobile financing company charges and collects illegal “pay-to-pay” fees from consumers statewide, in violation of the Commonwealth’s Consumer Credit Code, has discontinued his claims.
Mathew Caughey of Lawrence County first filed suit in the Allegheny County Court of Common Pleas on Feb. 6 versus Santander Consumer USA, Inc. (doing business as “Chrysler Capital”), of Dallas, Texas.
“On Oct. 4, 2021, Caughey purchased a Jeep. The plaintiff bought the vehicle primarily for personal, family, or household purposes and pursuant to a written Retail Installment Sale Contract. The RISC contains a choice of law clause selecting federal and Ohio law,” the suit said.
“Although Caughey travelled to Ohio to purchase the vehicle, Pennsylvania taxes were charged on the sale, the RISC listed a Pennsylvania address for Caughey, the vehicle is titled, registered, garaged, and principally used in Pennsylvania, the vehicle is inspected in Pennsylvania annually pursuant to Pennsylvania law, the vehicle is insured under a Pennsylvania auto insurance policy, all payments on the vehicle were made while Caughey was in Pennsylvania with a debit card with a Pennsylvania billing address, and the dealership sent a check into Pennsylvania to pay for the vehicle to be titled, registered, and licensed in Pennsylvania. Consequently, Pennsylvania law applies.”
The suit continued that after buying the vehicle, Caughey began making payments to Chrysler.
“On Aug. 10, 2022, Caughey made a payment by phone using a debit card. Chrysler charged a $3.75 ‘money transfer fee’ for this payment. On Sept. 3, 2022, Oct. 6, 2022, Nov. 4, 2022, and Nov. 6, 2022, Caughey made payments online using a debit card. Chrysler charged a $2.75 ‘money transfer fee’ for each payment,” the suit stated.
“As described herein, these ‘money transfer fees’ and similar “pay-to-pay” fees are illegal under Pennsylvania law. Chrysler knew or should have known that it was impermissible to charge, collect, contract for, or receive ‘pay-to-pay’ fees from Caughey. As a matter of policy or practice, Chrysler regularly charges, collects, contracts for, or receives ‘pay-to-pay’ fees from Pennsylvania purchasers, despite that the fact that these fees are illegal under Pennsylvania law. As a result of this conduct, Caughey and many Pennsylvanians lost money.”
On March 13, a mutual stipulation reached between the parties was filed, leaving open the possibility of a default judgment being issued if an answer from the defendants was not received by mid-April.
“The parties hereby stipulate and agree that defendant Santander Consumer USA, Inc. (doing business as “Chrysler Capital”)’s time to file an answer or otherwise respond to the complaint is extended to April 13, 2023. After the above date, a judgment of non pros or by default, as may be appropriate, may be entered upon praecipe without further notice,” the stipulation stated.
UPDATE
Without a decision being reached on the default judgment, plaintiff counsel filed a praecipe to discontinue the case on July 19.
“Please mark the above-entitled case as discontinued with prejudice,” the praecipe stated.
The plaintiff was represented by Kevin Abramowicz, Kevin Tucker, Chandler Steiger and Stephanie Moore of East End Trial Group, in Pittsburgh.
The defendant was represented by Melissa A. Ruth of Duane Morris, in Philadelphia.
Allegheny County Court of Common Pleas case GD-23-001775
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nick.malfitano@therecordinc.com