Hertz’s legal fight moves to Delaware court as nearly 50 file suit

Nearly 50 individuals have sued The Hertz Corp. in Delaware alleging the rental car giant reported vehicles stolen while the drivers were in good standing.

The lawsuit was filed July 14, the same day a federal judge issued a decision allowing a group of alleged victims to move their cases out of bankruptcy court and into state court. The suit was in bankruptcy court because the company filed for Chapter 11 reorganization in 2020.

While the Estero-based company’s exposure and the lawsuit are new, the allegations made in the lawsuit aren’t.

The company has been accused for more than a year of reporting vehicles stolen despite the renters having made their required payments. This practice has allegedly led to false arrests.

The legal push against Hertz is being led by Philadelphia attorney Francis Malofiy who, in 2014, sued Led Zepplin accusing the legendary band accusing it of stealing part of the classic song “Stairway to Heaven.”

In an emailed statement, Hertz says that it disagrees with the judge’s ruling and that it believes “claims from before Hertz emerged from bankruptcy should (not) be heard outside the bankruptcy proceedings.” 

“We have appealed the court’s ruling on this matter, and will continue to oppose any future requests to bring pre-emergence claims outside of bankruptcy court.”

As for the claims themselves, the statement goes on to say that “we are reviewing and considering each claim brought against Hertz on its individual merits. In furtherance of our stated commitment to resolve situations in which customers have been harmed by our actions, we have begun extending settlement offers to dozens of claimants and will continue to do so on a case-by-case basis.”

Shortly after taking over as CEO in February, Stephen Scherr apologized in a television interview.

“It’s not acceptable to Hertz to have any customer, a single customer sort of caught up in some of what’s happened,” he says, adding a moment later that “we will do right where our customers have been negatively affected and I’m looking to resolve that, you know, very, very quickly.”

Among those filing suit are Bianca DeLoach, a Georgia woman allegedly arrested in front of her two children despite paying Hertz $4,000, and James Tolen, a Texas man whose vehicle was reported stolen three months before he rented it.

One woman, Antwanette Hill, also of Georgia, was arrested four times between 2018 and 2020 because Hertz did not withdraw its charges that she stole the vehicle she’d rented, according the lawsuit.

The lawsuit asks that the alleged victims receive compensatory and punitive damages as well as attorney fees.

(This story has been updated to include a new, expanded statement from Hertz.)