On April 10, 2012, the federal District Court of New Jersey denied a motion to dismiss filed by Budget in Mendez v. Avis Budget Group, Inc., et al., Civil Action No. 11-6537, sustaining all counts, including his breach of contract and violation of the New Jersey Consumer Fraud Act claims.
Plaintiff's claims, asserted on behalf of a nationwide class of similarly situated individuals, targets Budget's undisclosed practice of collecting administrative fees for collecting toll charges incurred by its customers for the use of its e-Toll service, collecting those fees even on days when its customers did not use e-Toll, and charging customers for tolls at a cash rate rather than at the discounted rate actually charged for tolls paid electronically (upcharges).
In denying the motion, the Court rejected defendants' principal argument that the complained-of fees may be collected, and plaintiff required to pay, because the fees are disclosed in the "Collections" provision of the rental agreement plaintiff signed. As to why such fees appear in the "Collections" provision, rather than the "Rental Charges" provision, defendants offered that "they are only incurred if [Defendants] received] toll charges that it must then collect from the consumer."
The Court was "not convinced," noting that there were no allegations that plaintiff failed to pay for his tolls, ultimately finding "nothing in the contract indicates expressly or unequivocally that plaintiff would be responsible for" the complained-of fees and that plaintiff pleaded sufficient facts to support a finding that defendants' conduct constituted an affirmative act of misrepresentation.