Sunday

Detroit Plans Electric Caravan to Washington

First they flew in, each on their own private multi-million dollar plane, asking Washington for a bailout. Now, the word is that they're lining up their electric cars and planning a caravan trip to Washington. If it weren't so serious, I'd laugh out loud.

One day they are flush and flying private planes. When that doesn't work, they line up the 'lectric cars to prove they know how to make them. Maybe that'll get them their millions of bailout money.

Chrysler, for its part, is saying that it can't financially sponsor or back the caravan that their suppliers and workers are planning. But that won't stop it from happening, no doubt.

A caravan to DC? Folks, that's not enough. This isn't about jet planes or electric cars. It's not about the worker's union pay scale either. It's not even about the $25 billion. It's about cleaning house and we're not talking about the workers on the line. We're talking about the suits.

Did you know that most of the suits that run the auto companies only have a small (in some cases, far less than a fraction of 1%) invested in the companies they run? They want taxpayers to pony up billions to invest in a company that they themselves won't stand behind. Oh, they stand behind, alright. Way far behind.

To fix Detroit, the Detroit paradigm must change. We're not a genuis, we'll admit, but some things are obvious. And besides, there's no shortage of advice out there on fixing Detroit.

Warren Buffet thinks the minions that run Detroit should be required to invest their money in what they sell. Makes sense. After all, if they don't have enough faith in their business to invest their own money, why should taxpayers?

While trying to get union workers to help out sounds good, why treat them any differently than the way Wall Street workers were treated when the big investment companies were bailed out? Nobody asked them to take a pay cut. And their pay scale is a heck of a lot higher than a factory line worker in Detroit. Worse yet, has everyone forgotten what Ford did that caused unions to take hold in the first place?

Nonunion workers are an approach that works in some areas but it doesn't work everywhere. The Detroit Big 3 don't have the same belief system that made Toyota famous. After all, these are the car companies who own big private jets for their executives who don't have enough brains to know that you don't go begging wearing a tux. Workers need to watch 'em and be careful to protect themselves.

One more thing. It's okay to give them a loan, but it's time to force Detroit to increase the mpg rating of their fleets. Average fuel economy now is hardly any better than it was 30 and more years ago, in spite of all the so-called engineering and technology advancements. And we can't just trust them either. Detroit fought airbags for decades because it would cost a few extra bucks.

Some legislators are already talking about tieing any loan to mandatory mpg increases and they're right. Detroit ought to go electric and dump fossil fuel, but they won't do it voluntarily and they won't do it easily.

So, take the best ideas and marry them to a bailout. Start with requiring the CEO's to buy their own stock and freeze their salaries until the loan is paid off. And no stock options either. Next, leave union wages alone. Okay, don't raise them, but don't reduce them either.

Follow that up with a mandatory 50 mpg fleet increase within 5 years. Impossible? Hey, we went to the moon using computers that had less power than a Nintendo Wii. And when it hit the fan in Apollo 13 they saved the day with a roll of duct tape. Don't tell us 50 mpg in 5 years is impossible. If Congress had mandated it ten years ago, we'd of had it by now.

Will it work? Who knows for sure. But a lot of taxpayers would feel a lot better about the bailout if they did at least this much.

Maybe then they'll stop building lemons one day too. A pipedream? Not necessarily.

Burdge Law Office
www.NewCarLemonLaw.com

Because life is too short to put up with a lemon.

Wednesday

Forrest Gump Explains Mortgage Backed Securities & Lemon Cars

This blog is courtesy of our family and is about how Forrest explains mortgage backed securities. Read closely because it applies to Detroit too.

Mortgage Backed Securities are like boxes of chocolates.

Criminals on Wall Street stole a few chocolates from the boxes and replaced them with brown rocks in plain sight of some dishonest politicians in Washington. Their criminal buddies at Standard & Poor rated these boxes AAA Investment Grade Chocolates. The boxes were then sold all over the world to chocolate investors. Eventually the average taxpayer bites into one of the rocks and discovers the crime. Suddenly nobody trusts American chocolates anymore anywhere in the world.

Hank Paulson now wants the American taxpayers to buy up and hold all these boxes of rock-infested chocolates for $750 billion dollars until the market for rocks returns to normal. Meanwhile the Wall Street criminals and banks who stole all the good chocolates are not being investigated, arrested, or indicted.

Why? Because Congress had Freddy Mac and Fannie Mae manufacture the rocks in the first place.

Mama always said: 'Sniff the chocolates first, Forrest'.

Forrest is smarter than 99% of all the politicians.

Lemon cars are a lot like that. Simple parts that work are replaced with complex computer controlled parts that are programmed wrong or don't work after a short time. And then they go to Washington, hat in hand, asking for a bailout. Lemon cars stink. And the companies that make them stink too and someone ought to make manufacturers take them back and give us back our money. Someone does. Us. It's what we've been doing since 1978. Why? Because life is too short to put with with a lemon, or a rocky box of chocolates.

Burdge Law Office
Squashing lemons for 30 years.

Monday

Danger of Bankruptcy

Whether Detroit's Big 3 get their bailout or not, consumers need to know what it can mean to them when a business files bankruptcy on their claim or their lawsuit.

Recent reports of the bad economy undoubtedly worry consumers about the risk that the "target" defendant in their case may file bankruptcy and they probably are wondering what that would mean to their case if they did. Here's our thoughts.

There are two types of bankruptcies a business usually files and all lawsuits or claims are immediately stopped when any kind of bankruptcy is filed.

A "Chapter 7" bankruptcy is one where the entire business is completely liquidated, including all assets and all liabilities. The claims in a consumer's case would be a "liability" which would be included in that kind of bankruptcy. No more lawsuits are allowed to be filed and all the consumer can do is file a claim (sometimes called a "disputed and unliquidated" claim) in the bankruptcy proceedings for how much money they think is owed them. The bankrupt company’s attorney has the right to dispute any claim and the consumer would be notified if they did. All of the assets of the company are then sold or liquidated in one fashion or another to generate money and the bankruptcy court trustee, who is in charge of all of this, divides up the money according to the priority order of claims that is established by Federal Law. The bottom line is that it is very unlikely that a consumer would get much of anything out of a Chapter 7 bankruptcy. A Chapter 7 bankruptcy kills all legal liabilities of the bankrupt company.

Another kind of bankruptcy that a business can file is a "Chapter 11" bankruptcy.
In this kind of proceeding the bankrupt company basically files bankruptcy on all of its debts, but says that it wants to stay in business and keep operating. This kind of bankruptcy gives the company the ability to create a payment plan for all of the claims against it (and that would include the consumer's claim) while they continue to do business and struggle to survive. The consumer would have to file a claim again, in a fashion similar to what they would do in a Chapter 7 bankruptcy. The difference is that the consumer might have a slightly better chance of getting something out of a Chapter 11 bankruptcy proceeding because eventually the bankrupt company must explain to the bankruptcy court how it will pay off all the debt it has and that could end up being "pennies on the dollar" over several years. This kind of bankruptcy can be extremely complicated and often the bankrupt company can classify different kinds of debt and treat them differently. The bottom line to the consumer is that a Chapter 11 bankruptcy means they may get paid very little if they are lucky and they may get nothing at all. Frankly, some companies file a Chapter 11 bankruptcy just so they can liquidate the company and shut it down in an orderly way.

The filing of any kind of business bankruptcy is bad news for consumers. They lose all of their rights, they can no longer file any kind of lawsuit or continue fighting any kind of lawsuit against the bankrupt company, and they end up filing a claim in bankruptcy court and hope that they might get something out of it and often they get either nothing at all.

Many companies go out of business without ever filing a bankruptcy of any type. They simply close the doors when the money runs out. In that situation, it is very difficult to recover anything at all.

All of these are very significant risks that consumer have to consider in hard economic times. If you're trying to settle a lemon law claim with a manufacturer, you may want to take less in order to get it now and be sure you get something. You just never know ...

If you've got a lemon motor vehicle and you need help settling your case quickly, call us right now, 1-888-331-6422 Toll Free, or email us right now for fast help. We've been settling lemon law claims since 1978. We know how to get your money back. Fast.

Burdge Law Office
Because life's too short to put up with a lemon.

Thursday

Auto Help on the Way?

Corporate "suits" from the Detroit Big 3 showed up in Washington DC to testify before the US Congress on November 19 on why they needed to be part of the government's latest handout --- er, bailout --- program. It didn't help that they each flew there in their own private jet, folks.

In spite of the hostile treatment, apparently there's been a back-room deal cut for billions in US aid to head to Detroit's coffers soon. None of the details have been released but they should be leaking out soon.

Surprisingly, during the hearing the Big 3 repeatedly called the bailout a "bridge loan" but no one called it a bridge to nowhere, which many have argued it will be. We don't think so. Detroit needs the money, sure, but just paying last month's bills without changing the way the bills are generated isn't going to help the industry.

Meantime, there's no automatic relief here. Congress still has to pass a bill thru both houses and that won't be easy. Then the President has to sign off on it and that, too, won't be easy. It could easily take another month or two before it's done, and that is if it gets done at all.

So, don't count your dollar bills just yet, Detroit. There's still a lot of bricks to make before that bridge gets built, no matter where it's going.

Meanwhile, if you've got a lemon car or truck, you may want to try to settle up and get your money sooner rather than later --- just in case the bailout bails out and your lemon's manufacturer goes bust.

Burdge Law Office
Helping Consumers Get Even Since 1978.

Too Many Lawsuits?

There are so many new lawsuits clogging the courts that a dozen states are setting up a new kind of court to deal with the increasing numbers. It really is true, but you have to read on for the real truth in the story.

For years the insurance industry has done a great job of convincing the public that there are two many lawsuits clogging up the courts. In spite of numerous government and private studies that show the numbers aren't true, the public still believes what the insurance industry says.

Well, now there are a dozen states that either have, or are, setting up a new type of court to deal with the increasing number of lawsuits. It's called a Commercial Court and it only handles lawsuits between business companies. That's right. Corporations are clogging the system with lawsuits against other corporations.

Ohio is the latest state to establish Commercial Courts, setting up temporary rules to allow the new Court to set up shop in 5 counties, with one county already up and running while 3 others have agreed and one is still mulling it over. All of them are counties with a large population base and a large business base, Hamilton County (Cincinnati), Franklin County (where the state capital city exists, Columbus), Cuyahoga County (Cleveland), and Lucas County (the Toledo, Ohio area). The fifth one is rumored to be Montgomery County, covering the metropolitan Dayton, Ohio area.

Well, whaddaya know. The increase in litigation wasn't being caused by personal injury lawyers after all. Medical malpractice lawsuits by greedy consumers wasn't the reason either. You mean it wasn't auto accident cases either? Nope.

Turns out the cause has basically been the rash of corporate boardroom lawsuits against one another all across America. But you don't hear the conservative press talking about that. Or any press at all.

So, the next time someone says there's too many lawsuits going on in our society, you can agree. Just be sure to point out that it's businesses suing each other that are clogging up the court system. Problem is, they probably still won't believe you. You'd think consumers would get angry over the snow job the insurance industry has used to justify jacking up rates.

This is probably the first time that an industry did such a good job selling a lie as the truth, that when the truth came out, people thought it was the lie.

Wednesday

Lemon Laws that Suck


Not every state Lemon Law is a good one. Those graded as the worst include Colorado, Indiana, New Mexico, and North Dakota. These attempts to create consumer protecting Lemon Laws just plain suck.


Colorado is a good example. It has no provision for a deadly defect that threatens death or serious bodily injury, it provides for attorney fees to a prevailing manufacturer which means no consumer will sue and run the risk of having to pay an expensive corporate law firm, it has no provision for multiple different problems, and it forces consumers to resort to mandatory arbitration through biased auto company arbitration before they can exert their legal lemon rights. New Mexico's Lemon Law has the same defects.


Indiana is arguably even worse. It also has no deadly defect provision or limit on the quantity of different defects and forces consumers to go thru mandatory arbitration with a biased auto company arbitration before going to court. But to top it off, Indiana excludes conversion vans and motor homes. Guess where a ton of them are built. That's right. Indiana.


And North Dakota? I also has no deadly defect provision or limit on the number of defects either. And it also forces consumers to go thru a biased company arbitration before going to court too. Worse yet, it doesn't let the consumer recover their legal costs when they win.


If you live in one of these four states, your state Lemon Law just plain sucks. It's a good thing there's a federal Lemon Law that can still help you out.


Still, you should write to your state governor and state legislators and complain. These 4 laws are so weak that Lemon Law attorneys in Colorado, Indiana, New Mexico, and North Dakota usually just ignore their state Lemon Laws and instead use the federal Lemon Law and other consumer protection laws.


For a link to your state governor's office, so you can send your complaining email, check the US Motorcycle Lemon Law Summaries page by clicking here. You're a taxpayer and your state government should be protecting you and helping you protect yourself. That's what you pay taxes for.


Burdge Law Office


Because life's too short to put up with a lemon.




Sunday

Detroit Needs Help

When Congress threw billions of dollars at Wall Street's minions and the Bankers boardrooms, there were few everyday people who like the idea and we were with them. Perhaps it was because Wall Street and Bankers do not produce anything "real" to most of us. They play with our money and make money off of it in ways that the rest of us don't understand. All we know is we work for a living and they live off of us. But then there's Detroit, and that's different.

In a country that invented the automobile industry, it is inconceivable that the industry could go down the drain or bought up by foreigners, never mind the fact that we're really practically all foreigners anyway at least at our roots. It's just wrong.

Out of all brands of motor vehicles, only 5 had higher sales in October than the same time last year and not one of them was American made. There's something wrong with an industry that is so out of touch that they are losing money hand over fist while Audi, Ferrari, Mini Cooper, Rolls Royce and Smart are making it.

At a time when the overall US sales are down 31.9%, Min sales were up 56%, Ferrari sales were up 44% and Rolls was up 76%.

It's certainly true that Detroit needs help. GM's prediction that at the present rate it will run out of money in the middle of 2009 had to convince any skeptic that remained. But what to do, oh what to do.

The simple fact is that this society can not let Detroit fail. Why? Because every small town in America has a local auto parts store and that's just the obvious tip of the iceberg. Too many jobs in our economy depend on the auto industry. Washington has to step in and help out. After all, at least in Detroit they actually make things and that's a lot better than just juggling dollar bills and stock certificates.

However, if the industry is to survive it must evolve. Gasoline engines are marvelous but outdated and about as "ungreen" as one can get. Washington ought to make loans to Detroit and tie them to new technologies that can revolutionize the industry and put it on the best path for long-term dominance of the very industry which it created. That means fossil fuel burning engines have to go.

Whether it's electric power or what, who knows, but it's time for Detroit to tighten its belt even more, invent something new, invest heavily in places it has not gone. In short, to evolve.

Sure, we'e okay with giving Detroit loans, but tie it to planning for the future and not to paying for past mistakes.

One Car That Keeps On Selling


The 2009 Ford F150 debut has been moved back about two months to give dealers time to unload the oversupply of 2008 models still gathering dust on America's showroom floors. GM sales are off 45% from a year ago. Ford is down 32%. The whole industry is having weak sales. GM and Chrysler are even trying to figure out how to buy each other with taxpayer money so they can give most of Chrysler's models the axe.

Meanwhile, there's one car brand that sells for sticker every time and has since it came out. It's sold out constantly and dealers take orders for the cars that haven't even been built yet. Dealers can't get enough inventory and are practically begging for more. It's smart. The Smart car, that is.

In its first year 25,000 of the cute little cars barely stopped in their showrooms on their way into consumer's driveways nationwide.

Other brands not only offer discounts but throw in rebates and anything else that helps move the iron.

Meanwhile, Smart dealers are being urged not to charge more than the MSRP sticker price, but the temptation is big. There's not a lot of profit when the sticker price bottoms out at under $12,000 and tops out at under $17,000. The margin is thin but let's hope dealers do the right thing by their customers.

We first saw the Smart on the streets of Rome 4 years ago with a Mercedes badge on it and it was remarkable. When it finally got to the USA, most of it was the same and US buyers reacted just like the Europeans did --- they loved it. In fact, we would have bought one for our office vehicle except that the selling dealership network is limited and the dealer who had one was a dealer we've sued lots of times before over sales fraud issues so we just wouldn't go near the place.

Still, the Smart car is a great buy with good looks and great mileage. Just be careful if you're in the market for a Smart car. And if you end up with a lemon, don't forget to call us. We know how to get rid of lemons because it's what we do. Everyday.