Auto anti-theft and
antitrust bills now law

Car dealers must register
certain products with state

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By Lyn Danninger
ldanninger@starbulletin

A bill that would regulate vehicle anti-theft products and put them under the jurisdiction of the state's Insurance Division became law yesterday.

The new law will require auto dealers to register the anti-theft devices and accompanying warranties with the division.

The theft-deterrent systems, often referred to as Vehicle Theft Reduction or VTR, can include etching an identification number into the car windshield or windows and compensation for a stolen car. The idea behind the etching is to make it easier for police to identify and recover the stolen vehicle. Under the new law, only vehicle identification numbers can be etched on the car rather than any other kind of number assigned by the dealership.

The warranties will also now have to be backed by an insurance policy purchased from an insurer licensed to do business in Hawaii.

Car dealers favor the regulation because in several recent lawsuits, the VTR warranties have been alleged to be a form of insurance because they protect against a possible future event -- the theft of a vehicle.

If recognized as an insurance product, the VTR warranty would be subject to strict regulation under the insurance code as well as substantial fees.

Still, under the new law, dealers will have to register all such products they intend to sell with the Insurance Division.

"It helps clarify the issue and its status as an optional product people can purchase," said Dave Rolf, executive director of the Hawaii Automobile Dealers Association. "Now it becomes a matter of registering the product."

Another legislative bill that would allow a private citizen to bring a lawsuit or a class-action lawsuit against for unfair methods of competition also became law yesterday.

Until 1999, Hawaii law allowed for a private suits for antitrust or unfair competition. That year, a Hawaii Supreme Court decision determined private individuals did not have a right to sue for antitrust violations, attorney Tom Grande said.

"So this restores that law," he said.

A provision of the law requires that an individual pursuing legal action will first have to file a copy of the complaint and related information with the state Attorney General's Office.

The office then has 60 days to decide whether to file its own action on behalf of the state. That suit would supersede a private suit on the same complaint.

Grande said a good example of the type of lawsuit the new law allows would be one related to over-pricing of goods or services.

"In the case of goods and services that are overpriced, frequently in Hawaii it's the mainland distributor or manufacturer that is doing the overpricing," he said.

"This has the benefit of allowing for a suit directly against the wrongdoer."