CASE OF INTEREST

December 10, 2002

Contact: Terence M. Brown, Deputy District Attorney
Sacramento County District Attorney's Office
Consumer & Environmental Protection Division
(916) 874-6174

Tom Dresslar Deputy
Press Secretary
California Attorney General
(916) 324-5500

Re: People v. Roseville Toyota, Folsom Lake Toyota, Florin Road Toyota and Maita Toyota of Sacramento

Sacramento District Attorney Jan Scully announced that following a lengthy investigation by her office, the California Attorney General's Office, and the Department of Motor Vehicles, the Sacramento District Attorney and California Attorney General have today filed a civil anti-trust lawsuit.

The complaint, which was filed in Sacramento Superior Court, alleges that the four largest Toyota dealerships in the Sacramento area (John L. Sullivan's Roseville Toyota, Folsom Lake Toyota, Maita's Toyota, and Florin Road Toyota) violated California's anti-trust laws by agreeing among themselves not to advertise the prices of new Toyota vehicles.

Since early in 1999, none of these four dealerships have advertised prices of new Toyota vehicles in the Sacramento Bee. The only prices advertised by the defendants in the Bee were prices for used Toyotas. When asked, defendants' salespeople have routinely informed customers that there is an agreement in effect among the Sacramento area Toyota dealers not to advertise the prices of new Toyota vehicles. In other metropolitan areas in California, such as the San Francisco Bay Area, Toyota dealerships routinely advertise prices for new Toyota vehicles.

The complaint also alleges that each of the defendants own other vehicle franchises, which have continued to advertise prices on their new vehicles in the Bee. Thus, for instance, if a reader examines the automotive advertisements in the Bee over a weekend, he will discover that although Sullivan's Chevrolet does advertise the prices of new Chevrolets, Sullivan's Roseville Toyota will not advertise the price of any new Toyota. *

Finally, the complaint also alleges that Sullivan's Roseville Toyota made unsubstantiated and misleading underselling claims. That is, Roseville Toyota ran advertisements which stated and implied that consumers could purchase a new Toyota for less at Roseville Toyota than at other Sacramento area Toyota dealerships. This was false and misleading in that the average profit realized per new Toyota was greater at Roseville Toyota, than at the other Sacramento area Toyota dealerships.

The lawsuit asks the Court to impose civil penalties and to order the defendants not to enter into or implement any agreement to fix prices or to refrain from advertising the price of new Toyota vehicles.

* For example, compare the advertisement at page L1 of the December 7th Sacramento Bee (where Sullivan's Roseville Toyota posts no prices for new Toyotas) with the advertisement at page H1 of the December 6th Sacramento Bee (where Sullivan Chevrolet lists the prices of a number of new Chevrolet vehicles.)

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