A Ramsey County man is suing Cedar Towing & Auction after he said the tow operator overcharged him and forced him to pay in cash, both in violation of city ordinance. The Hennepin District Court lawsuit accusing Cedar Towing of fraud and deceptive business practices comes a few months after police began an investigation of the company, the city’s largest tow operator.
While I've been told by someone at Cedar Towing that the company is consulting with its lawyer and hopes to have a formal response today, Cedar Towing posted on its Facebook page last month following Matt McKinney's story about the police investigation, that “We make every effort to follow the Minneapolis City Ordinances & Minnesota State Statutes. Several years ago the towing industry in Minneapolis was regulated by a price cap, due to a mis-reading of the City Ordinance, we may have inadvertently charged excess storage for vehicles towed from the City of Minneapolis.”
In 2008, the city passed an ordinance capping the fees that towing companies are permitted to charge. After adjustment for inflation, the service fee for the towing is now capped at $212 and the storage fee for keeping the vehicles at the impound lot is capped at $28, according to the complaint. Towing companies are permitted to charge storage fees the day after a vehicle is towed.
As McKinney previously reported, the city’s licensing department conducted a spot inspection of Cedar Towing’s impound lot in August and found that it had charged vehicle owners with a storage fee on the day the vehicles were towed, which would be a violation of the ordinance. As of that time, Cedar Towing had towed 3,640 vehicles this year within Minneapolis, according to the search warrant.
In the Facebook statement Cedar Towing says, “In our defense if the City Licensing Inspector thought we were doing something wrong he should have notified us at once telling us to cease whatever action we were doing.”
After the inspection, the licensing department referred the case to the city police, who in October seized two boxes of employee records and a digital record of all tows this year from Cedar Towing. The alleged overcharges could amount to $100,000 this year alone. Police spokesman Sgt. Steve McCarty said the investigation is continuing.
The lawsuit, which seeks class action status, describes how Wayne Spar of Ramsey County was visiting a friend the night of Sept. 18 when he parked his car in a lot on the east side of LaSalle Avenue north of Groveland Avenue that's used by customers of Frattallone’s Ace Hardware, AM Food Market and other stores.
According to the complaint, after several hours, Spar saw a Cedar Towing trucks near his car. He asked if he could move the car before being towed. The driver demanded $100 cash, the complaint said. Spar said he could retrieve the money from the friend’s house, but the driver said he couldn’t wait and then towed Spar's car to Cedar Towing’s lot.
When Spar went to get his car, he was charged "more than the maximum allowed for a tow by the Minneapolis Code
of Ordinances in order to retrieve his vehicle" and told to pay cash. City ordinance requires private towing companies to accept the same methods of payment that the city does at its impound lot, which includes credit cards, checks and money orders.
“Getting your car towed is a huge hassle,” said Michelle Drake, Spar’s attorney, in a statement. “Being hijacked for excessive fees makes an already bad situation both intolerable and illegal. By filing this lawsuit, we hope to get peoples’ money back.”