Arbitration Mechanism in Consent Order Provides Complete Remedy for Aggrieved Consumers

The Minnesota Court of Appeals upheld an arbitration provision in a consent order between the Minnesota Attorney General and a car dealership to hear consumer complaints, holding that the provision provides all consumers with an adequate remedy.

In Weigand v. Walser Automotive Group, Inc., No. A05-1911, 2006 WL 1529511 (Minn. App. Jun 06, 2006), Jeffrey Weigand brought a lawsuit under Minnesota’s private-attorney-general statute against Walser Automotive for alleged deceptive trade practices. The statute allows private citizens to bring suit to protect the public in lieu of the attorney general. But Walser had previously entered into a consent order with the Minnesota Attorney General allowing consumers to arbitrate their claims if the dealership did not satisfactorily resolve their complaint.

When Weigand brought his complaint, Walser moved for summary judgment because Weigand could no longer show a public benefit required to bring a private-attorney-general action, since the attorney general had already acted to protect the public interest. Weigand argued that the consent order only benefited future consumers, so his lawsuit brought as a past consumer should be allowed to proceed.

The Court rejected Weigand’s argument, holding that the consent order required Walser to attempt to resolve “all consumer complaints,” and that the arbitration mechanism provided a remedy for past customers like Weigand to address their claims. Weigand argued that the arbitration procedure only acted as a forum to present consumer complaints, but the Court disagreed. The Court stated that the arbitration procedure allowed consumers to “seek damages and, presumably, be awarded damages if they are so entitled.” The Court therefore upheld the summary judgment dismissal of Weigand’s claim.