Hertz settles dozens of customer lawsuits after Action News investigation

"I was in jail for 12 days. It was humiliating," said Kelly Grady, who was interviewed by Action News in 2017.

ByChad Pradelli and Cheryl Mettendorf WPVI logo
Wednesday, June 22, 2022
Hertz settles dozens of customer lawsuits after 6abc investigation
Hertz rental car company has agreed to settle nearly three dozen lawsuits brought by customers who say the agency wrongly reported its vehicles as stolen. Some customers have been arrested and jailed.

PHILADELPHIA (WPVI) -- The Hertz rental car company has agreed to settle nearly three dozen lawsuits brought by customers who say the rental agency wrongly reported their vehicles as stolen. Some customers say they have been arrested and jailed.

It's a story the Action News Investigative Team first broke in 2018.

Police body camera video captured the moment a Plymouth Township, Montgomery County officer handcuffed a visibly distraught Saleema Lovelace in January 2021.

Police were responding to a call of an auto theft and arrested her for allegedly stealing the Hertz rental car she was driving.

SEE ALSO: Investigation: Hertz customers arrested after rental vehicles mistakenly reported stolen

Watch the report from Investigative Reporter Chad Pradelli on Action News at 11 p.m. on May 17, 2018.

"Listen to what he is saying! Roll your windows down! Put your hands outside!" said an officer in the video.

Lovelace said she'd been renting a Hertz vehicle from its subsidiary, Dollar Car Rental, for six months after getting into a car accident.

"This car is reported stolen from Hertz Rental Car. Did you rent it?" an officer said in the video.

"Yes!" said Lovelace.

In her interview with Action News, Lovelace said, "When they grabbed me it was just... that's the part that bothered me the most. Me walking backward, me knowing there was a gun drawn on me and my father in the car."

Lovelace said she had arranged a date to bring the vehicle for an inspection and the company charged her credit card on file for nearly $4,000 one day before her arrest.

Attorney Francis Malofiy, who is based in Media, represents many of the alleged victims.

"In 2017, when ABC first broke this story, it went from one case to two cases and now it's grown to 330 plus cases all around the country," said Malofiy.

SEE ALSO: Action News Investigation: Customers sue Hertz for false theft claims

More victims have come forward saying they have been falsely arrested, and some even jailed, for allegedly stealing cars.

Malofiy blames a faulty reporting and payment system at Hertz for the wrongful arrests.

"We have some clients who spent seven months in jail, we have some clients who spent one day in jail, we have some clients who were sexually assaulted and beaten in jail," said Malofiy.

One of those alleged victims was Kelly Grady who Action News interviewed in 2017 and was eventually awarded $100,000.

"I was in jail for 12 days," said Grady. "It was humiliating. It was scary. It was horrible. It was degrading. I was sexually assaulted and gang beaten."

In April, Hertz CEO Stephen Scherr admitted to a problem on national TV and said rectifying the situation is a "priority" and called it "unfortunate."

The company filed for bankruptcy protection in 2020.

Civil litigation had been tied up, but Malofiy says earlier this month a bankruptcy judge ruled 89 cases could proceed in applicable state courts.

Hertz now tells Action News it "looks forward to reaching resolutions in the months ahead."

The rental car giant declined to comment if Lovelace is part of the initial or any upcoming settlement offers.

Alleged victims like Lovelace say their arrests and charges have been traumatic.

"I feel like I am going to have an anxiety attack," said Lovelace on video during her arrest.

She and 39 others are still currently being prosecuted for rental car thefts.

"You got to take more responsibility, update your system," Lovelace told Action News. "People's lives are being jeopardized from them not doing what they are supposed to do."

The fallout has led United States Senator Richard Blumenthal to write a letter to the Federal Trade Commission requesting it to open an investigation into Hertz. The FTC could not comment.

A Hertz spokesperson released this statement to Action News:

"Hertz cares deeply about our customers, and we successfully provide rental vehicles for tens of millions of satisfied travelers each year. While we remain steadfast in our commitment to defend the company's interest against those that intend harm, we also want to do right by our customers.

Today Hertz has sent settlement offers to about three dozen individuals who had a negative experience with our company.

This is the first set of offers and is not exhaustive. We are moving through all the claims to ensure that each unique situation is reviewed and considered on its individual merits. We expect some of our offers will be for more money than the proof of claim filed for these individuals, and some of our offers will be significantly less. We look forward to reaching resolutions in the months ahead as we work through the process."