Hertz 2009 Annual Report Download - page 66

ITEM 3. LEGAL PROCEEDINGS (Continued)
misrepresenting that this assessment is owed by consumers, rather than the rental car
defendants, to the California Travel and Tourism Commission, or the ‘‘CTTC’’. The complaint
also alleges that defendants agreed to pass through to consumers a fee known as the Airport
Concession Fee, which fee had previously been required to be included in the rental car
defendants’ individual base rates, without reducing their base rates. Based on these
allegations, the complaint seeks treble damages, disgorgement, injunctive relief, interest,
attorneys’ fees and costs. The court has dismissed all claims against the CTTC, and plaintiffs
dropped their claims against Caroline Beteta. The court also dismissed all claims against the
rental car defendants except for the federal antitrust claim. The plaintiffs’ have appealed the
dismissal of their claims against the CTTC to the United States Court of Appeals for the Ninth
Circuit. The remaining claim against us, the federal antitrust claim, is in the discovery stage.
We are currently a defendant in a consolidated action captioned ‘‘In re Tourism Assessment
Fee Litigation’’ pending in the United States District Court for the Southern District of California.
Originally filed as two separate actions in December of 2007, the consolidated action purports
to be a class action brought on behalf of all persons and entities that have paid an assessment
since the inception of the Passenger Car Rental Industry Tourism Assessment Program in
California on January 1, 2007. The other defendants include various of our competitors,
including Avis Budget Group, Inc., Vanguard Car Rental USA, Inc., Dollar Thrifty Automotive
Group, Inc., Advantage Rent-A-Car, Inc., Avalon Global Group, Enterprise Rent-A-Car
Company, Fox Rent A Car, Inc., Beverly Hills Rent-A-Car, Inc., Rent4Less, Inc., Autorent Car
Rental, Inc., Pacific Rent-A-Car, Inc., ABC Rent-A-Car, Inc., as well as The California Travel and
Tourism Commission, and Dale E. Bonner. The complaint sought injunctive and declaratory
relief, that all assessments collected and to be collected be held in trust, unspecified monetary
damages, interest, attorneys’ fees and costs. The district court has dismissed all of plaintiffs’
claims against all defendants. Plaintiffs have appealed to the United States Court of Appeals for
the Ninth Circuit.
5. Patent Infringement
On February 19, 2007, we filed an action entitled The Hertz Corporation and TSD Rental LLC v.
Enterprise Rent-A-Car Company and The Crawford Group, Inc. The suit was filed in the United
States District Court for the District of Massachusetts alleging that Enterprise unlawfully
engaged in anticompetitive and unfair and deceptive business practices. On September 25,
2007, we filed a second lawsuit, also captioned The Hertz Corporation and TSD Rental LLC v.
Enterprise Rent-A-Car Company and The Crawford Group, Inc. in the United States District
Court for the District of Massachusetts seeking a declaratory judgment that a newly issued
patent to Crawford is not infringed by Hertz and is invalid and unenforceable. These two cases
were later consolidated and the parties agreed to a non-monetary settlement and joint
dismissal in June 2009.
6. Public Liability and Property Damage
We are currently a defendant in numerous actions and have received numerous claims on
which actions have not yet been commenced for public liability and property damage arising
from the operation of motor vehicles and equipment rented from us and our licensees. The
obligation for public liability and property damage on self-insured U.S. and international
vehicles and equipment, as stated on our balance sheet, represents an estimate for both
reported accident claims not yet paid and claims incurred but not yet reported. The related
liabilities are recorded on a non-discounted basis. Reserve requirements are based on
actuarial evaluations of historical accident claim experience and trends, as well as future
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