Harley-Davidson Class Action Says MSRPs Include Setup Costs

A class action lawsuit claims that Harley-Davidson advertises that the cost of the Manufacturer’s Suggested Retail Price (MSRP) does not include setup charges, when in fact it does.

Plaintiff Matthew D. Greene alleges that in 2015, he was interested in purchasing a Harley-Davidson, and researched the specifications, pricing, and features of specific motorcycles. He also claims that he looked at the price tags at a Harley-Davidson dealership in Riverside, Calif.

The plaintiff says the advertising that he saw and relied upon when choosing to purchase a motorcycle stated that the MSRP “excluded dealer setup, taxes, title and licensing and are subject to change.”

“As such, Plaintiff reasonably anticipated that he should expect any Harley-Davidson dealer from whom he might purchase a motorcycle to impose and/or collect from him a ‘dealer setup charge,’” the Harley-Davidson class action lawsuit claims.

The Harley-Davidson class action lawsuit alleges that Harley-Davidson paid the dealership in Riverside (and other dealerships) for performing “dealer setup,” which means that the advertised MSRP did include “dealer setup.” The plaintiff claims that Harley-Davidson’s advertising to the contrary was false and misleading.

The plaintiff notes that he purchased a motorcycle from a Harley-Davidson dealership for $23,799.63 which “included all costs, fees, and charges but excluding interest.” The price of the motorcycle also included a $1,399 for freight and “prep.”  

According to Greene, this amount was shown on the price tag as being excluded from the total retail price of the motorcycle.

“Plaintiff was induced by Harley-Davidson’s false and misleading statements, representations, and/or affirmations, and misrepresentations, to pay RHD’s charge of $1,399 for freight and ‘prep,’ which explained and/or justified to consumers that the imposition of a ‘prep’ or ‘setup’ charge (or surcharge) by a Harley-Davidson dealer was reasonable, appropriate, and should be anticipated/expected,” the Harley-Davidson class action lawsuit argues.

The plaintiff maintains that if he had known about the $1,399 charge when he purchased his motorcycle, he would not have agreed to pay the dealer the “setup” or “prep” charge. That said, he did pay the $1,399 for freight and “prep” as he relied on Harley-Davidson’s false statements, representations, and/or affirmations that a “dealer setup” fee was not included in the MSRP.

The Harley-Davidson class action lawsuit states that in August 2017, Harley-Davidson started to disclose in their advertising that they reimburse dealers for fulfilling inspection and setup duties. That said, these disclosures came too late for the plaintiff, who didn’t have an inkling that the company did this.

The class action lawsuit alleges violations of California Business & Professions Code (False Advertising), Consumer Legal Remedies Act, Breach of Express Warranty, Negligent Misrepresentation, Fraud & Deceit, Quasi-Contract/Unjust Enrichment, Aiding and Abetting, and Unfair Competition.

Potential Class Members include: “All Consumers who, for a period beginning June 11th, 2015 through August 22, 2017 purchased or leased from Riverside Harley-Davidson a new, assembled, Harley-Davidson motorcycle.”

This case was originally filed in the Superior Court of California, County of Riverside, but has since been removed to the U.S. District Court for the Central District of California.

The plaintiff is represented by Ross H. Hyslop of Pestotnik LLP.

The Harley-Davidson MSRP Class Action Lawsuit is Greene v. Harley-Davidson Inc., et al., Case No. 5:19-cv-01647, in the U.S. District Court for the Central District of California.

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