Chrysler reportedly bouncing checks to owners of lemon law vehicles

Going through the process of having a troubled vehicle legally branded as a 'lemon' is difficult enough, but now, according to The Los Angeles Times, Chrysler's bankruptcy is making seeking recompense even harder for affected owners in California. According to the daily paper, settlement checks for Chrysler vehicles that have already been agreed upon as defective are apparently bouncing, costing already irked consumers additional time and money.
Apparently, the heart of the issue stems from the fact that financial claims made prior to the company's April 30 Chapter 11 filing can only be paid out if the bankruptcy judge approves the action. To date, Chrysler has apparently not requested the court's permission to make good on these lemon law payments, leaving little recourse for affected consumers.
Many affected owners have apparently spoken with attorneys, who apparently can't do much unless the lemon law payback accounts in question are unfrozen by the bankruptcy court. That means consumers could be out anywhere from a couple of thousand dollars to the entire cost of a new vehicle – one attorney, Alex Simanovsky, is quoted as saying that he has "a stack of six or seven checks in my drawer right now from Chrysler that have bounced" – settlement payments ranging from $2,000 on up to $40,000. Some consumers have already turned-in their defective vehicles to Chrysler, compounding the problem.
For its part, the LA Times says that Chrysler is telling customers with lemon law claims to get in line – by filing a claim with the courts, in effect joining the automakers other unsecured creditors seeking payment. In that scenario, however, defective car owners aren't expected to see much more than "pennies on the dollar."
Consumer groups have reportedly met with auto task force members to discuss the matter, but as of yet, there is no word on any remedy in the works. Thanks for the tip, MopePar!
[Source: The Los Angeles Times]




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Reader Comments (Page 1 of 3)
adam1drift 2:31PM (5/18/2009)
lol I'm sorry i just have to... its so funny
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Noidor 2:57PM (5/18/2009)
So much for buying American. Yet another example of patriotism and isolationism adversely affecting US.
Frank 8:05AM (5/19/2009)
Autoblog does it again. The car is yellow and is vaguely lemon shaped but - the PT Cruiser is one of Chrylser's most dependable cars, scoring high even in that "fair" (but not to Chrysler) and "scientific" magazine Consumer Reports.
mapoftazifosho 2:38PM (5/18/2009)
LOLOLOL
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Tomac 2:38PM (5/18/2009)
This is like feeling sorry for someone who willingly sticks their hand in a fire. It's a Chrysler, what did you expect?
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Ben 4:26PM (5/18/2009)
LOL!! You said it correctly.
mikecanada 6:37PM (5/18/2009)
exactly!!!
tuxchown 11:14PM (5/18/2009)
Y'all wanted a goddamned bankruptcy. Enjoy!
Soul Shinobi 1:38AM (5/19/2009)
I was hoping someone would say this for me, toché!
Marc 2:41PM (5/18/2009)
And Chrysler thinks they will ever have a chance again with the American consumer. Between this the bankruptcy and the dealer closings and layoffs there isnt a chance in hell. Just shut the the doors for good of this worthless company, if fiat was smart they would bail b4 they dig themselves into a deeper hole.
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Ben 4:28PM (5/18/2009)
Like I said eons ago - DIE already, Chrysler!
Tony 2:41PM (5/18/2009)
Are their anymore ways that Chrysler can screw everybody, but the rich executives? This company should be shut down period. I would never buy any of their products and have advised all my clients to do the same.
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Platinum_Skeet 5:07PM (5/18/2009)
I'd buy a dodge challenger though...
larry a 3:43AM (5/19/2009)
I wanted to yell at my brother for buying a Jeep Cherokee a few months ago. "I got it for 13k off MSRP"
BigTeebo 2:52PM (5/18/2009)
At least give them a new car to drive(for free) until they get their $.
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Jake B 3:16PM (5/18/2009)
The problem is that the Lemon agreement isn't through the dealership it is through the manufacturer. Unfortunately Chrysler is a bunch of broke greedo's that can't pay their debts. It was hard enough for my girlfriend to lemon her Mazda 3 2.3 I can only imagine trying to sort through that nightmare with Chrysler.
Jared 3:57PM (5/18/2009)
It is unlikely that Chrysler has the ability to make that type of decision while in Chapter 11 -- they'd need approval from the bankruptcy judge.
John 2:53PM (5/18/2009)
Sadly, a lemon law claim is the same as any other debt. Now that Chrysler is in bankruptcy, they can flush all these obligations.
You have Obama drastically cutting their advertising, delays on new product development, and now this bad PR. I see no hope for Chrysler.
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zamafir 6:04PM (5/18/2009)
I'm with you man, Chrsyler should have just gone ch 7 without Obama.
jcar302 3:02PM (5/18/2009)
They better get this fixed quickly.
As if americans didn't already have enough reason not to buy a chrysler.
They might as well close up completely.
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