A lawsuit claims a Long Island luxury auto dealership systematically bilked customers at its collision center in a scheme that involved paying off insurance adjusters to falsify repair estimates, inflating labor costs and not replacing parts as needed.
The Rallye Collision Center carried out “a pervasive deception scheme,” said Carle Place attorney Jeffrey Brown, who filed the lawsuit Monday in State Supreme Court in Nassau County.
The business allegedly paid adjusters between $100 and $200 for every $1,000 in deceptive billing they generated, sometimes coding these costs on customer bills as “clean and wax,” according to the lawsuit.
Brown alleged Monday that Rallye gave invoices to customers that were difficult to understand and while final repair prices were close to estimates, new parts slated for installation would get converted into fictitious labor costs — generating “pure profit.”
The Carle Place collision center is part of a company that markets itself as the biggest luxury auto dealer on Long Island and the fifth largest sales dealership in the country, selling brands such as Porsche, Mercedes-Benz, Rolls-Royce and BMW, the lawsuit says.
The lawsuit names as defendants Rallye Motors LLC, Rallye Motors Holding LLC, owner and CEO Juliana Terian and any other related entities.
Manhattan attorney Ted Kaplan, who represents Rallye, said Monday that the company doesn’t comment on pending litigation.
The lawsuit’s plaintiff is Salvatore Stile, 50, a North Shore resident who said Monday he was ripped off in 2016 after bringing his 2015 Mercedes-Benz sedan to the collision center after a crash.
When the car’s service was finished, the charges itemized in the bill were vastly different from the estimate – showing a 71 percent reduction in the cost of parts, but a 137 percent increase in labor charges, the lawsuit says.
It claims Stile fell victim to the alleged deceptive scheme "because he purchased labor that was not performed," and certain parts that needed to be replaced were not.
Stile, who works in international shipping, said that while “no one likes to feel that they’re being duped in any situation,” the safety aspect of the alleged scam bothered him more.
“My family could have been in jeopardy … It was, for my mind, dollars over life,” Stile said.
The lawsuit seeks designation as a class action, arguing that the plaintiff believes there are “thousands of customers” who have been damaged by the alleged “deceptive and misleading practices.”
Brown said his law firm is working with a whistleblower — who will be filing a separate complaint — after facing "adverse consequences and retaliation” from Rallye after bringing the alleged scam to the attention of management.
Monday’s lawsuit also describes 17 other customer repairs from March or April 2016 in which the same kind of fraud allegedly took place, reportedly causing vehicle owners to lose value in their autos and get stuck with higher insurance premiums.
Among its demands, the civil claim seeks unspecified monetary damages, and says the defendants should be required to correct the auto repairs — with an independent examiner named to oversee the collision center for some time after the lawsuit’s conclusion.