[Federal Register Volume 79, Number 250 (Wednesday, December 31, 2014)]
[Notices]
[Pages 78868-78869]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-30650]


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FEDERAL TRADE COMMISSION

[File No. 142 3117]


TXVT Limited Partnership, Doing Business as Trophy Nissan; 
Analysis of Proposed Consent Order To Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement.

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SUMMARY: The consent agreement in this matter settles alleged 
violations of federal law prohibiting deceptive acts or practices. The 
attached Analysis to Aid Public Comment describes both the allegations 
in the draft complaint and the terms of the consent order--embodied in 
the consent agreement--that would settle these allegations.

DATES: Comments must be received on or before January 22, 2015.

ADDRESSES: Interested parties may file a comment at https://ftcpublic.commentworks.com/ftc/tvxtlimitedconsent online or on paper, 
by following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Write ``TXVT Limited 
Partnership, a Texas Limited Partnership, d/b/a Trophy Nissan--Consent 
Agreement; File No. 1423117'' on your comment and file your comment 
online at https://ftcpublic.commentworks.com/ftc/tvxtlimitedconsent by 
following the instructions on the Web-based form. If you prefer to file 
your comment on paper, write ``TXVT Limited Partnership, a Texas 
Limited Partnership, d/b/a Trophy Nissan--Consent Agreement; File No. 
1423117'' on your comment and on the envelope, and mail your comment to 
the following address: Federal Trade Commission, Office of the 
Secretary, 600 Pennsylvania Avenue NW., Suite CC-5610 (Annex D), 
Washington, DC 20580, or deliver your comment to the following address: 
Federal Trade Commission, Office of the Secretary, Constitution Center, 
400 7th Street SW., 5th Floor, Suite 5610 (Annex D), Washington, DC 
20024.

FOR FURTHER INFORMATION CONTACT: Luis Gallegos, (214) 979-9383, 
Southwest Region, 1999 Bryan Street, Suite 2150, Dallas, TX 75201-6808.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal 
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34, 
notice is hereby given that the above-captioned consent agreement 
containing consent order to cease and desist, having been filed with 
and accepted, subject to final approval, by the Commission, has been 
placed on the public record for a period of thirty (30) days. The 
following Analysis to Aid Public Comment describes the terms of the 
consent agreement, and the allegations in the complaint. An electronic 
copy of the full text of the consent agreement package can be obtained 
from the FTC Home Page (for December 23, 2014), on the World Wide Web, 
at http://www.ftc.gov/os/actions.shtm.
    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before January 22, 
2015. Write ``TXVT Limited Partnership, a Texas Limited Partnership, d/
b/a Trophy Nissan--Consent Agreement; File No. 1423117'' on your 
comment. Your comment--including your name and your state--will be 
placed on the public record of this proceeding, including, to the 
extent practicable, on the public Commission Web site, at http://www.ftc.gov/os/publiccomments.shtm. As a matter of discretion, the 
Commission tries to remove individuals' home contact information from 
comments before placing them on the Commission Web site.
    Because your comment will be made public, you are solely 
responsible for making sure that your comment does not include any 
sensitive personal information, like anyone's Social Security number, 
date of birth, driver's license number or other state identification 
number or foreign country equivalent, passport number, financial 
account number, or credit or debit card number. You are also solely 
responsible for making sure that your comment does not include any 
sensitive health information, like medical records or other 
individually identifiable health information. In addition, do not 
include any ``[t]rade secret or any commercial or financial information 
which . . . is privileged or confidential,'' as discussed in Section 
6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 
4.10(a)(2). In particular, do not include competitively sensitive 
information such as costs, sales statistics, inventories, formulas, 
patterns, devices, manufacturing processes, or customer names.
    If you want the Commission to give your comment confidential 
treatment, you must file it in paper form, with a request for 
confidential treatment, and you have to follow the procedure explained 
in FTC Rule 4.9(c), 16 CFR 4.9(c).\1\ Your comment will be kept 
confidential only if the FTC General Counsel, in his or her sole 
discretion, grants your request in accordance with the law and the 
public interest.
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    \1\ In particular, the written request for confidential 
treatment that accompanies the comment must include the factual and 
legal basis for the request, and must identify the specific portions 
of the comment to be withheld from the public record. See FTC Rule 
4.9(c), 16 CFR 4.9(c).
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    Postal mail addressed to the Commission is subject to delay due to 
heightened security screening. As a result, we encourage you to submit 
your comments online. To make sure that the Commission considers your 
online comment, you must file it at https://ftcpublic.commentworks.com/ftc/tvxtlimitedconsent by following the instructions on the Web-based 
form. If this Notice appears at http://www.regulations.gov/#!home, you 
also may file a comment through that Web site.
    If you file your comment on paper, write ``TXVT Limited 
Partnership, a Texas Limited Partnership, d/b/a Trophy Nissan--Consent 
Agreement; File No. 1423117'' on your comment and on the envelope, and 
mail your comment to the following address: Federal Trade Commission, 
Office of the Secretary, 600 Pennsylvania Avenue NW., Suite CC-5610 
(Annex D), Washington, DC 20580, or deliver your comment to the 
following address: Federal Trade Commission, Office of the Secretary, 
Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610 (Annex 
D), Washington, DC 20024. If possible, submit your paper comment to the 
Commission by courier or overnight service.
    Visit the Commission Web site at http://www.ftc.gov to read this 
Notice and the news release describing it. The FTC Act and other laws 
that the Commission administers permit the collection of public 
comments to consider and use in this proceeding as appropriate. The 
Commission will consider all timely and responsive public comments that 
it receives on or before January 22, 2015. You can find more 
information, including routine uses permitted by the Privacy Act, in 
the Commission's privacy policy, at http://www.ftc.gov/ftc/privacy.htm.

[[Page 78869]]

Analysis of Proposed Consent Order To Aid Public Comment

    The Federal Trade Commission (``FTC'') has accepted, subject to 
final approval, an agreement containing a consent order from TXVT 
Limited Partnership, d/b/a Trophy Nissan. The proposed consent order 
has been placed on the public record for thirty (30) days for receipt 
of comments by interested persons. Comments received during this period 
will become part of the public record. After thirty (30) days, the FTC 
will again review the agreement and the comments received, and will 
decide whether it should withdraw from the agreement and take 
appropriate action or make final the agreement's proposed order.
    The Respondent is a motor vehicle dealer. The matter involves its 
advertising of the purchase, financing, and leasing of its motor 
vehicles. According to the FTC complaint, Respondent has advertised 
that when a consumer trades in a used vehicle in order to purchase a 
new vehicle and pays $1.00, Respondent will pay off the balance of any 
loan or lease agreement on the trade-in vehicle such that the consumer 
will have no remaining obligation for any amount of that loan or lease. 
The complaint alleges that in fact, when a consumer trades in a used 
vehicle with negative equity (i.e., the loan or lease balance on the 
vehicle exceeds the vehicle's value), pays $1.00, and purchases another 
vehicle, Respondent does not pay off the balance of the loan or lease 
agreement on the trade-in vehicle such that the consumer will have no 
remaining obligation for any amount of that loan or lease agreement. 
Instead, the Respondent includes the negative equity from the trade-in 
in the loan for the newly purchased vehicle. The complaint alleges 
therefore that the representation is false or misleading in violation 
of Section 5 of the FTC Act.
    The complaint also alleges that Respondent has advertised that 
Respondent would match consumers' income tax refund for use as a down 
payment on an automobile. The complaint alleges that Respondent's 
advertisement did not disclose adequately additional terms pertaining 
to the offer, such as that Respondent would match only up to $1,000 of 
consumers' income tax refund. The complaint alleges therefore that the 
failure to disclose adequately the additional terms is deceptive in 
violation of Section 5 of the FTC Act.
    The complaint further alleges that Respondent advertised that 
consumers could lease advertised vehicles at terms prominently stated 
in the advertisements, including, but not necessarily limited to, the 
monthly payment amount. The complaint alleges that Respondent's 
advertisements did not disclose or disclose adequately additional terms 
pertaining to the lease offer, such as the total amount of any payments 
due at lease inception. The complaint alleges that these additional 
terms were material to consumers in deciding whether to lease a 
vehicle. The complaint alleges therefore that the failure to disclose 
or disclose adequately the additional terms is deceptive in violation 
of Section 5 of the FTC Act.
    In addition, the complaint alleges violations of the Consumer 
Leasing Act (``CLA'') and Regulation M for failing to disclose or to 
disclose clearly and conspicuously certain costs and terms when 
advertising leases. Finally, the complaint alleges violations of the 
Truth in Lending Act (``TILA'') and Regulation Z for failing to 
disclose or to disclose clearly and conspicuously certain costs and 
terms when advertising credit.
    The proposed order is designed to prevent the Respondent from 
engaging in similar deceptive practices in the future. Part I.A of the 
proposed order prohibits the Respondent from misrepresenting that it 
will pay any particular amount of the remaining loan or lease 
obligation on a consumer's trade-in vehicle used to purchase, finance, 
or lease another motor vehicle, including representing that the 
Respondent will pay the entire remaining obligation on the trade-in 
vehicle when the consumer will actually be responsible for paying that 
amount. Part I.B of the proposed order prohibits Respondent from 
misrepresenting the material terms of any promotion or other incentive, 
and the nature, value, or amount of a promotion or other incentive, 
including, but not limited to, that Respondent will match a consumer's 
tax refund for use as the down payment on the purchase of a vehicle. 
Part I.C prohibits the Respondent from misrepresenting the cost of: (1) 
Leasing a vehicle, including, but not necessarily limited to, the total 
amount due at lease inception, the down payment, amount down, 
acquisition fee, capitalized cost reduction, any other amount required 
to be paid at lease inception, and the amounts of all monthly or other 
periodic payments; or (2) purchasing a vehicle with financing, 
including but not necessarily limited to, the amount or percentage of 
the down payment, and the repayment obligation over the full term of 
the loan, including any balloon payment. Part I.D prohibits the 
Respondent from misrepresenting any other material fact about the 
price, sale, financing, or leasing of any vehicle.
    Part II of the proposed order prohibits Respondent from making any 
representation about any promotion or other incentive including, but 
not limited to, that Respondent will match a consumer's tax refund for 
use as the down payment on the purchase of a vehicle, without 
disclosing clearly and conspicuously, the terms and limitations of such 
promotion or other incentive.
    Part III of the proposed order requires Respondent to clearly and 
conspicuously make all of the disclosures required by CLA and 
Regulation M if they state relevant trigger terms, including the 
monthly lease payment or the amount of any payment or that any or no 
initial payment is required at lease inception. In addition, Part III 
prohibits any other violation of CLA or Regulation M.
    Part IV of the proposed order requires that the Respondent clearly 
and conspicuously make all of the disclosures required by TILA and 
Regulation Z if they state the amount or percentage of any downpayment, 
the number of payments or period of repayment, the amount of any 
payment, or the amount of any finance charge. In addition, Part IV 
prohibits the Respondent from stating a rate of finance charge without 
stating the rate as an ``annual percentage rate'' or the abbreviation 
``APR,'' using that term. Part IV also prohibits any other violation of 
TILA and Regulation Z.
    Part V of the proposed order requires Respondent to keep copies of 
relevant advertisements and materials substantiating claims made in the 
advertisements. Part VI requires that Respondent provide copies of the 
order to certain of their personnel. Part VII requires notification to 
the Commission regarding changes in corporate structure that might 
affect compliance obligations under the order. Part VIII requires the 
Respondent to file compliance reports with the Commission. Finally, 
Part IX is a provision ``sunsetting'' the order after twenty (20) 
years, with certain exceptions.
    The purpose of this analysis is to aid public comment on the 
proposed order. It is not intended to constitute an official 
interpretation of the complaint or proposed order, or to modify in any 
way the proposed order's terms.

    By direction of the Commission.
Janice Podoll Frankle,
Acting Secretary.
[FR Doc. 2014-30650 Filed 12-30-14; 8:45 am]
BILLING CODE 6750-01-P