CIADA LEGAL PROTECTION FUND (“CLPF”)


Colorado is now starting to experience what other states have seen over the last several years, a few attorneys actively soliciting consumer lawsuits against the automobile industry. This is expanding throughout the nation with certain attorneys looking for highly regulated industries to file individual consumer lawsuits or even class action suits. Some of these lawsuits are legitimate but some suits are merely intended to obtain an attractive settlement form the dealer. Therefore, a CIADA Legal Protection Fund ("CLPF") has been formed to help protect members against Truth in Lending Act and Colorado Consumer Protection Act lawsuits. The CLPF purpose is to fight selected lawsuits brought against the members by forcing the consumer to go to trial, settling the suit is not the intent. By providing an aggressive defense the hope is to discourage future lawsuits against CIADA members. The CLPF committee will determine how funds are allocated based on the legitimacy of the suit and the ability to prevail. Not every lawsuit is guaranteed a defense. The hope is to discourage future lawsuits against CIADA members.

Terms and Conditions:

Ability to join CLPF is exclusive to CIADA members in good standing.

All funds to be held in a separate account used at the discretion of the CLPF committee strictly for the defense of CLPF members.

All CLPF members will receive periodic reports showing the CLPF balance, membership information and disclosure of all transactions.

The CLPF committee, based on the legitimacy of the lawsuit and the ability to prevail, must approve release of funds for each occurrence of legal defense.

One must be a member of CLPF prior to the filing of any lawsuit against the Member's dealership.

All CLPF members will be of equal standing with equal contribution amounts as determined by the CLPF committee.

If any CLPF member has an insurance policy for legal defense, this coverage must be exhausted before receiving any CLPF proceeds.

The CLPF fund only pays legal defense fees of up to $10,000.00 per suit.

Any damages awarded, attorney fees if the customer wins at trial or the settlement amount if a dealer elects to settle are entirely the responsibility of the dealer. The CLPF committee will review CLPF Member's case with CIADA's staff attorney based upon written criteria regarding the merits of the customer's claims and the CLPF Member's possible defenses. The criteria includes CLPF Member's compliance with state and federal laws prior to the suit being initiated and the factors which gave rise to the suit. If the criteria regarding the customer's claims and the CLPF Member's possible defenses are met, the CLPF committee will notify the CLPF Member that their case is eligible for participation in the CLPF and if the CLPF Member elects to participate in the CLPF, the CLPF Member will enter into a Participation Agreement with CLPF. In order to have attorney fees for the defense of the customer's claims paid from the CLPF, the attorney to be retained by the CLPF Member must have extensive knowledge of dealership operations, motor vehicle sales, extensive TILA and CCP A litigation experience and agree not to charge more than $175.00 per hour for all services provided. If the attorney to be retained by the CLPF Member meets all requirements under the Participation Agreement, as verified by the CLPF committee, the CLPF Member may retain the attorney and is eligible for payment of attorney fees to the retained attorney from the CLPF upon execution of a Retainer Agreement between the attorney and the CLPF Member.

The initial CLPF membership fee is $500.00. Before fees can be paid for defense, the CLPF must have a minimum of $20,000.00 in the fund. If the $20,000.00 amount is not reached by July 1, 2014, all funds will be reimbursed to Members. The CLPF committee reserves the right to ask for additional funding as needed to allow CLPF to provide necessary member defense. However, the intent of the CLPF is to attract enough dealers at the $500.00 contribution level so additional funding is not necessary.

When the CLPF is dissolved, all remaining funds shall be equally disbursed to every Member in good standing.

By signing below you agree to all above mentioned terms and conditions.


Dealership Name: _______________________________________________     Date:____________________________

By: ___________________________________________________________