Massachusetts Sues Dealership Over Discriminatory Pricing of Black and Hispanic Consumers

Cars in dealership Photo Source: Adobe Image Stock

A Massachusetts car dealership is at the center of a lawsuit brought forward by the state. The lawsuit alleges that the business discriminated against Black and Hispanic customers by overcharging them on services and products.

The lawsuit was filed in Essex County Superior Court and accuses Jaffarian Service Inc. of violating the state's Consumer Protection Act and the Public Accommodations Law by engaging in unfair, deceptive, and discriminatory price practices.

Attorney General Maura Healey shared in a statement, “Purchasing a vehicle is already a significant financial decision for many families and individuals — the last thing they should be worried about is unfairly paying more for a product because of their race or national origin.”

According to the lawsuit, the car dealership sells vehicles as well as other related products and services which the lawsuit describes as “ancillary or add-on products.” According to the lawsuit, employees within the car dealership have “unfettered discretion in pricing ancillary products.”

The complaint goes on to explain that the dealership does not provide employees with “guidance, training, auditing, or supervision to prevent discrimination” when these ancillary or add-on products are sold. Instead, the dealership has a compensation model which incentivizes employees to increase the price they charge consumers as they see fit. As a result of this arbitrary pricing model, Black and Hispanic consumers are more likely to be charged higher prices for the same product than white customers. The complaint claims that “Jaffarian seeks and extracts disproportionately higher profits from Black and Hispanic consumers” and that “Jaffarian’s actions impede Black and Hispanic consumers' ability to participate fully and fairly in commerce, thereby contributing to the racial wealth gap.”

The complaint goes on to detail that because of this discriminatory behavior, Black and Hispanic customers pay an average of $500 more and $400 more respectively for the same products purchased by white customers. As a result of this discrepancy in pricing, the state accuses the dealership of pulling in over $170,000 in ill-gotten gains over the past two years.

The state is seeking injunctive relief, civil penalties, restitution, and other fees as part of its lawsuit.

Nadia El-Yaouti
Nadia El-Yaouti
Nadia El-Yaouti is a postgraduate at James Madison University where she studied English and Education. She lives in Central Virginia with her husband and two little girls. Although she considers herself a workaholic, when she’s not juggling work, you can be sure to find her traveling the world with her little family.
Legal Blogs (Sponsored)