Hertz 2012 Annual Report Download - page 67

ITEM 3. LEGAL PROCEEDINGS (Continued)
combination with Dollar Thrifty. On February 14, 2013, we were informed by the staff that the
investigation has been completed and that no action was taken by the staff or the SEC.
1. Hertz Equipment Rental Corporation, or ‘‘HERC,’’ Loss Damage Waiver
On August 15, 2006, Davis Landscape, Ltd., individually and on behalf of all others similarly
situated, filed a complaint against HERC in the United States District Court for the District of
New Jersey. In November 2006, the complaint was amended to add another plaintiff, Miguel V.
Pro, and more claims. The Davis Landscape matter purports to be a nationwide class action on
behalf of all persons and business entities who rented equipment from HERC and who paid a
Loss Damage Waiver, or ‘‘LDW,’’ or an Environmental Recovery Fee, or ‘‘ERF.’’ The plaintiffs
seek a declaratory judgment and injunction prohibiting HERC from engaging in acts with
respect to the LDW and ERF charges that violate the New Jersey Consumer Fraud Act and
claim that the charges violate the Uniform Commercial Code. The plaintiffs also seek an
unspecified amount of compensatory damages with the return of all LDW and ERF charges
paid, attorneys’ fees and costs as well as other damages. The court has granted class
certification, denied our motion for summary judgment and the case is in the discovery stages.
In February 2012, we filed separate motions for partial summary judgment on the LDW and ERF
claims and we filed a motion to decertify the class. In June 2012, the judge denied our motion
for partial summary judgment on the LDW claim and, in July 2012, the judge granted our
motion for partial summary judgment on the ERF claim. The court also entered an order
referring the case to mediation by private consent of the parties. We have continued to work
through the mediator and in direct discussions with plaintiffs’ counsel on an acceptable
settlement of this litigation and have accrued our best estimate of the ultimate cost which is not
material to our financial condition.
2. Concession Fee Recoveries
On October 13, 2006, Janet Sobel, Daniel Dugan, PhD. and Lydia Lee, individually and on
behalf of all others similarly situated v. The Hertz Corporation and Enterprise Rent-A-Car
Company, or ‘‘Enterprise,’’ was filed in the United States District Court for the District of Nevada.
The plaintiffs agreed to not pursue claims against Enterprise initially and the case only
proceeded against Hertz. The Sobel case purports to be a nationwide class action on behalf of
all persons who rented cars from Hertz at airports in Nevada and were separately charged
airport concession recovery fees by Hertz as part of their rental charges. The plaintiffs seek an
unspecified amount of compensatory damages, restitution of any charges found to be
improper and an injunction prohibiting Hertz from quoting or charging those airport fees that
are alleged not to be allowed by Nevada law. The complaint also seeks attorneys’ fees and
costs. Relevant documents were produced, depositions were taken and pre-trial motions were
filed. After the court rendered a mixed ruling on the parties’ cross-motions for summary
judgment and after the Lydia Lee case was refiled against Enterprise, the parties engaged in
mediation which resulted in a proposed settlement. Although the court tentatively approved the
settlement in November 2010, the court denied the plaintiffs’ motion for final approval of the
proposed settlement in May 2011. Since that time, the plaintiffs filed a motion for class
certification—which we opposed—and discovery has commenced again. A separate action is
proceeding against Enterprise, National and Alamo. In May 2012, all briefing was completed on
the two outstanding issues—unjust enrichment and damages. The briefing included expert
reports as submitted by both sides. In October 2012, the court held a hearing on the plaintiffs’
motion for class certification. The court has since entered a stay order and the parties will again
be engaging in mediation.
43