Pub 5. 2015 Issue 3

9 Noncompliant ads fail to disclose that rebates are limited and/ or deduct limited rebates from a vehicle’s advertised price. Pur- chasers must be able to purchase all vehicles described by an advertisement at the advertised price. It is a violation of the law to sell a car for more than the advertised price. Free Gift and Prize Offers. It is also a violation of the MVAR (14 Ill. Admin. Code 475.590) to advertise or offer free prizes, gifts or other incentives in connection with the purchase or lease of a vehicle where the vehicle is sold or leased at a price arrived at through bargaining or negotiation. An incentive offered through a manufacturer’s program, or authorized dealer advertising asso- ciation, without any participation by the dealer, is permissible if the program or association is clearly and conspicuously disclosed, along with all material terms and conditions relating to the offer, at the outset of the offer. Coupons. The Illinois Consumer Fraud and Deceptive Busi- ness Practices Act (815 ILCS 505/2J.1) provides, in pertinent part, “No coupon shall be offered in connection with any retail sale of a motor vehicle.” Loan Advertising to Persons Adjudged Bankrupts. Credit ad- vertising claims made to persons adjudged bankrupt violate the Illinois Loan Advertising to Bankrupts Act (720 ILCS 330/1 et seq.). The Act prohibits advertisements stating or implying that financing or extension of credit will be made to a person who has been adjudged bankrupt. Sale Claims. It is a violation of the MVAR (14 Ill. Admin. Code 475.370) to advertise sale terminology (e.g., "sale", "dis- count", "savings", "price cut", "reduced", "clearance", "tent sale", and other similar terms), which states or implies a price savings, unless the current selling price of the vehicle is reduced by a rea- sonable amount from the vehicle's former (regular) price as also defined in the MVAR. Guaranteed Trade-In Amounts. Advertising or offering a specific trade allowance or a range of amounts for trade-ins, in- cluding without limitation, that the trade-in will be valued at a guaranteed minimum amount violates the MVAR (14 Ill. Admin. Code 475.540). Compliance analysis of an ad might begin with the following threshold questions: • Is the substance of the advertisement prohibited (for example, dealer rebates, guaranteed trade-in amount)? • Does the substance of the advertisement require a par- ticular format or treatment? • Does the nature of the advertisement require disclosures (for example, credit advertising Truth-in-Lending; limita- tion as to quantity of advertised vehicles; limitation as to the effective period of the advertised offer)? • If prices for vehicles are listed, are they the total adver- tised prices? • Does the advertising format clearly distinguish between lease and sale offers if both are present? • If a credit sale is advertised, are there “triggering” terms, and, if so, are all necessary and required disclosures in- cluded; or if the advertisement refers to a consumer lease, are there “triggering” terms, and, if so, are all necessary and required disclosures included? • If disclosures are necessary, are they published “clearly and conspicuously”? • Are the disclosures understandable and appropriate in light of the content of the advertisement? • Has the dealership designated a responsible agent to re- view the advertising “proof” to screen for possible errors? Dealers should ensure their advertising and business practices fully comply with applicable federal and state laws and regula- tions and, as necessary, consult with private counsel for compli- ance assistance. n Julie A. Cardosi is Principal of the private firm, Law Office of Julie A. Cardosi, P.C., of Springfield, Illinois, and has exclusively represented the unique business interests of automobile dealers state-wide for nearly 25 years. Formerly in-house staff legal counsel for the Illinois Automobile Dealers Association, she concentrates her practice in the areas of dealership ownership transfers (asset purchases and stock acquisitions), mergers and acquisitions, franchise law and franchise issues, factory relations, corporate law, add points, commercial real estate transfers, advertising, and other issues impacting day-to-day dealership operations. She is a primary author of the original Illinois Motor Vehicle Advertising Regulations, 14 Ill. Admin. Code 475, Adopted at 15 Ill. Reg. 17950.