Federal Lawsuit Says FedEx Replaced Odometers in Used Vehicles Before Selling Them
When FedEx vehicles reach the end of their lifecycle they are typically resold, often to small businesses, to be repurposed into food trucks and more. However, a new class action federal lawsuit is accusing FedEx of "the largest odometer fraud scheme in U.S. automotive history" after many buyers learned that they essentially bought a lemon.
Prior to 2011, FedEx would simply scrap their delivery vehicles once they reached 350,000 miles. However, the company later began auctioning old vans off through its fleet company, Holman Fleet Leasing, which is also listed as a defendant in the lawsuit. FedEx and Holman are being accused of intentionally replacing the odometer in used vehicles and then selling them at auction with 100,000 miles or less, and then splitting the profits.
Unfortunately, the actual mileage on the vehicles was sometimes up to four times what the odometer read. Buyers would soon be faced with mechanical issues and mounting bills, causing some small business owners to go belly up.
Tom Layton, a Henderson, NV-based commercial truck dealer, first discovered that he had inadvertently sold a FedEx truck with an inaccurate odometer back in 2017, after noticing that some commercial trucks going through his dealership had odometers issues.
"About a month after the sale, the FedEx contractor contacted me and said, 'Hey! What are you trying to pull here?'" Layton told KTNV 13 News in Las Vegas. "And I said, 'What's wrong?' And he said, 'I took this into Freightliner and had the vehicle hooked up to the computer. And it has over 400,000 miles. And your odometer says 180,000 miles.'"
The federal class action lawsuit, filed last week in New Jersey last week, names four plaintiffs from California, Florida, Tennessee, and Virginia who represent thousands of potential victims from across the country. All four plaintiffs purchased vehicles from FedEx with fewer than 100,000 miles on their odometers, only to be faced with extensive repair bills and losses to their businesses.
The complaint is citing the the Odometer Act of 1972, which prohibits the tampering with a motor vehicle's odometer and protects buyers in the sale of motor vehicles with altered or reset odometers. The law also states that replaced odometers must register the same mileage as the original odometer prior to being changed out.
"FedEx, with the knowledge and assistance of Holman, replaced thousands of odometers on FedEx/Holman Vehicles," the lawsuit states, according to The Drive. "Though odometers, as automotive components, do occasionally wear out or malfunction and need to be replaced, there was no valid reason for this large-scale replacement of the odometers on FedEx/Holman Vehicles, other than to perpetuate their agreement to commit odometer fraud."
However, FedEx is denying any and all wrongdoing, telling Santa Monica's Spectrum 1 News in a statement: "We are aware of the allegations made in the complaint and will vigorously defend the lawsuit."
