You Just Received a Consumer Complaint. Now What?

It happens to good dealers.

A consumer files a complaint with the Attorney General's office, the Better Business Bureau, or directly through an attorney. The complaint lands on your desk and your first instinct are to either ignore it or fire off a response defending yourself.

Do neither.

You do not need to respond immediately; every entity gives you days or weeks to respond. If the consumer is calling, explain you need time to seriously consider their complaint. Use that time to review it thoroughly and respond appropriately.

Step 1: Read it carefully and say nothing yet.
Before you respond, before you call the consumer back, before you talk to your staff about what happened — read the complaint in its entirety. Understand exactly what is being alleged, which transaction it involves, and what the consumer says they want.

Your state’s consumer protection laws give consumers broad grounds to bring complaints, including catch-all provisions that cover conduct a dealer might not immediately recognize as a legal violation. These laws are usually known as Unfair and Deceptive Acts or Practices acts (UDAP). An allegation that seems minor on its face — a misrepresentation about a vehicle's history, a failure to disclose a known defect, a fee that wasn't clearly explained — can carry significant exposure under Pennsylvania law, including the possibility of treble damages and attorney's fees if the matter proceeds to litigation.

Read it like an attorney would. Better yet, send it to one.

DO NOT USE AI to analyze it. The industry and heck, the world, is pushing AI for everything. However, those conversations with the chatbots are discoverable information in court. A good old fashion phone call to an attorney who understands this is area of the law is a much better option to understand your exposure.

Step 2: Preserve everything.
Pull the deal jacket immediately. Every document related to that transaction — the buyer's order, the retail installment contract, the as-is disclosure, the weowe, any inspection records, all written communications — needs to be gathered and preserved before anything is altered, lost, or misplaced.

If your staff had verbal conversations with this consumer, write down what they remember now, while it is fresh. Notes made contemporaneously carry far more weight than recollections made months later when the matter is in front of a hearing officer.

Do not destroy, alter, or "clean up" any documents once a complaint has been received. What feels like routine record management at this stage can look like spoliation later.

Step 3: Do not contact the consumer directly.
This is the mistake that turns a manageable complaint into an expensive problem.

Calling the consumer to "work it out," even with the best intentions, can result in statements that are used against you, agreements that aren't properly documented, or conduct that looks like an admission of wrongdoing.

If the complaint came through the Pennsylvania Attorney General's office or the Board of Vehicles, your response will go through those channels. These agencies keep track of whether the business responds to them. Even if you resolve it with the consumer, the State may think you are unresponsive because they have not received anything from you.

Step 4: Respond on time and respond correctly.
If the complaint requires a formal response, from the AG's office, the Board of Vehicles, or through a demand letter from the consumer's attorney, there will be a deadline.

Missing it is not an option. Late or nonresponses escalate complaints into formal proceedings faster than almost anything else a dealer can do.

Your response should be factual, documented, and measured. It should not be defensive, emotional, or volunteering information beyond what is directly responsive to the allegations. Every word of a written response to a regulatory agency can be used in subsequent proceedings.

Failure to respond or responding with too much information can open up your dealership to a larger, more expensive, investigation.

Step 5: Assess the business decision honestly.
If the Complaint has escalated to a lawsuit, it is important to evaluate settling the lawsuit. Not every complaint that has legal merit is worth fighting. And not every complaint without merit is worth settling.

The calculus involves the strength of your documentation, the credibility of the consumer's allegations, the cost of litigation versus resolution, and the reputational considerations specific to your market. A dealer in a small community may weigh resolution differently than a high-volume dealer in a metro area.

I know so many dealers who want to fight a meritless case “on principal” but that principal can be far more expensive than settling. Deciding whether to fight or settle is a business decision as much as a legal one and it should be made with counsel who understands both dimensions.

The bottom line:
A consumer complaint is not a verdict. It is the beginning of a process. Dealers who respond strategically, preserving records, staying quiet until they understand the full picture, and getting legal guidance early, resolve complaints far more favorably than those who react or do nothing.

If your dealership receives a consumer complaint, do not wait to get help. MidAtlantic Independent Dealer Association is a good starting point for general help. If you need true legal advice, the earlier an experienced dealer defense attorney is involved, the more options you have.