Hertz to pay $168 million to settle lawsuit over false arrests


Hertz said Monday it will pay $168 million to settle hundreds of claims by customers who were falsely reported by the rental car company as having stolen their vehicles, with some innocent renters arrested and jailed for weeks or months over the reports.

Hertz said in a brief statement that it settled 364 claims, which it said accounted for 95 percent of the outstanding claims against the company over the false theft reports.

Dozens of customers had shared stories on social media and aired TV shows about being arrested, “swatted” or stopped at border crossings after Hertz falsely reported them to authorities for stealing vehicles from its rental fleet.

Hertz claims that thousands of renters steal cars. Customers claim they have been falsely accused.

In many of the cases, the customer had paid for and returned the car correctly weeks or months before – or had never rented a car at all.

Drew Seaser, a real estate appraiser in Colorado, learned of an arrest warrant in Georgia when he was stopped at the airport on his way to Mexico with his family. Seaser told CBS News that he had never been to Georgia or rented a car from Hertz. He was imprisoned for more than 24 hours; the charges were dismissed after his lawyer provided prosecutors with an alibi.

Paul-Anthony Knight said on “Inside Edition” that he was arrested after Hertz mistakenly filed a theft report against him. “All guns drawn on me. I was thrown to the ground. I was arrested. And I was locked up for over a week, he said. Another man, Julius Burnside, told the program he was jailed for more than six months because of a false report.

It was not immediately clear whether Seaser, Knight and Burnside were among the plaintiffs who settled with Hertz, which emerged from bankruptcy in 2021. A lawyer for dozens of customers suing Hertz in Delaware did not immediately respond to a request for comment.

Hertz said in February that “the vast majority of these cases involve renters who were many weeks or even months late in returning vehicles and who stopped communicating with us well beyond the scheduled due date.”

But Hertz CEO Stephen M. Scherr was more apologetic, saying in April on CNBC’s “Squawk Box” that “it’s not acceptable for Hertz to have any customer, any single customer kind of caught up in some of what’s happened .” He said the problem of false theft reports was “among the first things” he tackled since taking the helm of the company in February. “Several hundred people” were affected by the reports, he said.

Erroneous reports were retracted when discovered, Scherr said, “yet these people were caught, you know, in an instant” when the retraction of the reports was “not recognized” by law enforcement. The false reports were “unfortunate”, he said.

Marisa Iati contributed to this report.

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