In the Matter of General Motors LLC, File Number 152-3101 #00071

Submission Number:
00071
Commenter:
Jeff Sovern
State:
New York
Initiative Name:
In the Matter of General Motors LLC, File Number 152-3101
The proposed consent decree would allow an auto dealer to sell as certified cars that have potentially lethal safety defects if the dealer disclose that the car is subject to an open recall. Considerable empirical research demonstrates that consumers often ignore disclosures. A book-length treatment of the issue, with the title indicating the findings, is Omri Ben-Shahar & Carl E. Schneider, More Than You Wanted to Know: The Failure of Mandated Disclosure 12 (2014) ("not only does the empirical evidence show that mandated disclosure regularly fails, failure is inherent in it"). Even leading legal lights admit to skipping over disclosures. See Chief Justice Roberts Admits He Doesn't Read the Computer Fine Print, ABA J. (Oct 20, 2010), available athttp://www.abajournal.com/weekly/article/chief_justice_roberts_admits_he... Judge Posner Admits He Didn't Read Boilerplate for Home Equity Loan, ABA J. (Jun 23, 2010), available athttp://www.abajournal.com/weekly/article/judge_posner_admits_he_didnt_re.... I suspect many consumers will interpret the word "certified" as meaning any defects have been fixed and will not go beyond that to read carefully a disclosure, no matter how clear and conspicuous, that contradicts their understanding. For a study showing that consumers ignore disclosures in favor of their pre-conceptions, albeit in another context, see Jeff Sovern, Elayne Greenbert, Paul Kirgis, Yuxian Liu, 'Whimsy Little Contracts' with Unexpected Consequences: An Empirical Analysis of Consumer Understanding of Arbitration Agreements, 75 Maryland Law Review 1 (2015), available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2516432. Accordingly, the result of the consent decree would be that consumers pay premium prices for unsafe cars that they believe to be safe and do not have repaired, endangering themselves, their families, and others on the road.