EFiled: May 21 2020 10:07PM EDT Transaction ID 65652125 Case No. N20C-05-189 VLM IN THE SUPERIOR COURT OF THE STATE OF DELAWARE Hannah Ayoub Nicole Stevens; Shontrell Higgs Julius Burnside Magalie Sterlin Arthur Stepanyan Howard Junious Laketa Collins Michelle Johnson Brian Steinberg Antwone Person Michael Koss Amanda Koss Cheryl Young Stephanie Keene James Keene Barbara Fernandez Thomas John Channell Michael Channell Jessica Gurumendi Plaintiffs Civil Action No.: JURY TRIAL DEMANDED vs. Hertz Global Holdings, Inc. The Hertz Corporation Rental Car Intermediate Holdings, LLC Hertz Investors, Inc. Hertz Vehicles LLC Hertz Vehicle Financing LLC and Hertz Vehicle Financing II LP Hertz Local Edition Corp. Dollar Rent A Car, Inc. Thrifty Rent-A-Car System LLC Icahn Associates Holding, LLC Icahn Enterprises LP Icahn Enterprises Holdings LP Icahn Capital LP Icahn Enterprises GP, Inc. Paul Stone Kathryn Marinello John P. Tague, Mark Paul Frissora M. David Galainena Richard Frecker Page 1 of 92 Richard E. Esper Leslie Hunziker . Tom Kennedy Jodi Allen Jeffrey T. Foland Murali Kuppuswamy Tyler Best Alexandreia Marren Frederic Deschamps Jamere Jackson Eliana Zem Robin C. Kramer Opal G. Perry Matthew Jauchius Tom Callahan Scott Massengill . Henry R. Keizer David A. Barnes Carolyn N. Everson Vincent J. Intrieri Samuel Merksamer Anindita Mukherjee Daniel A. Ninivaggi Kevin M. Sheehan SungHwan Cho Defendants PLAINTIFFS’ COMPLAINT Page 2 of 92 Table of Contents INTRODUCTION ............................................................................................................ 4 BACKGROUND ON HERTZ THEFT REPORTING AND THE SERIOUS ISSUES HERTZ CORPORATE HAS BEEN IGNORING FOR YEARS ....................................... 6 HERTZ FALSIFIES PAYMENT INFORMATION IN POLICE REPORTS TO SECURE ILLEGAL ARRESTS & PROSECUTIONS .............................................. 11 HERTZ ERASES RENTAL EXTENSIONS AND BACKDATES THE RENTAL DUE DATE ........................................................................................... 15 HERTZ’S FAILURE TO INVESTIGATE THEFT REPORTS RESULTS IN ILLEGAL ARREST AND PROSECUTIONS ........................................... 18 HERTZ IMPROPERLY DESTROYS ITS RECORDS RELATING TO THE CRIMINAL PROSECUTION OF CUSTOMERS ......................................................... 23 DIRECTOR AND OFFICER LIABILITY AND NOTICE TO THE CORPORATION ................... 24 PARTIES ...................................................................................................................... 30 PLAINTIFFS ....................................................................................................... 30 DEFENDANTS .................................................................................................... 62 JURISDICTION, VENUE, JOINDER ................................................................................. 68 CAUSES OF ACTIONS ................................................................................................... 70 CLAIMS FOR RELIEF .................................................................................................... 91 Page 3 of 92 Introduction 1. Defendants Hertz Global Holdings and The Hertz Corporation have been hiding a massive corporate scandal, aided and abetted by their directors and officers. 2. Hertz has been falsely reporting untold numbers of customers for car theft, throwing them in jail on felony charges for months, prosecuting them, causing them to lose their jobs, giving them criminal records, causing them to lose their homes, and separating them from their family and loved ones. These customers have paid for their cars and are authorized to use the rentals. 3. The company’s computer and inventory tracking systems are broken. However, the top corporate officers and directors have decided that verifying theft reports, and fixing their computers, would be too expensive. 4. Defendant Hertz has instead decided—at the very highest level—to mass report its own customers to the police without verification, effectively using the police, criminal justice system, and taxpayers to subsidize inventory control for a private corporation. 5. Hertz and its top officials are dishonestly and maliciously turning potential civil disputes with customers about payment (payment which Hertz has usually already received)— which are required to be arbitrated or addressed in small claims court—into criminal theft reports and prosecutions. As this Complaint explains, by doing so the company is savings tens of millions of dollars.1 6. Hertz’s policies, procedures, and practice disproportionately condemn poor minorities to prison and prosecution while presuming their guilt. Many of these innocent individuals—lacking money and access to effective legal services—remain wrongfully imprisoned for months as their cases slowly wind their way through the courts. 1 More information on this scandal can be found here: www.truthhertz.net. Page 4 of 92 7. This plan is as brilliant as it is evil, saving the company millions upon millions of dollars it would otherwise have to spend updating its broken systems and paying corporate security personnel to verify the thousands of theft reports it makes every year. 8. As a result of this routine and systemic mass reporting, without verification or investigation, many innocent customers have been wrongfully detained, arrested, thrown in prison, prosecuted, and had their lives destroyed. 9. This is not some sort of error. The company and its leadership have known about these problems for many years—since at least 2015, and likely far earlier—after falsely imprisoned customers and police agencies notified Hertz corporate about these serious issues. Hertz did nothing to address these problems, instead deliberately placing the Almighty Dollar before the lives and safety of their customers, including the Plaintiffs. 10. Hertz has even been sued and lost lawsuits for intentional infliction of emotional distress and malicious prosecution for the same conduct at issue in this case in 2017—but has continued to falsely report customers for theft calculating that it will make more money if it does not fix the problem. 11. Hertz’s corporate representatives testified in those lawsuits that their “marching orders” are to routinely disregard the standard operating procedures designed to safeguard against and prevent false reports as part of cost saving measures imposed by Hertz corporate. 12. What differentiates this scandal from Worldcom, Enron, Arthur Anderson, Bear Stearns, FIFA, Volkswagen, WeWork, or even Madoff, is that those cases were only about money. Uniquely, the clients in this case had their lives destroyed, with consequences in the hundreds of millions of dollars. 13. Thomas Channel cannot undo the heart attack he suffered as he was being held at gunpoint for car theft, nor the resulting emergency operation. Plaintiff Julies Burnside cannot get Page 5 of 92 back the 7 months he spent in prison. Plaintiff Shontrell Higgs cannot undo the 171 days she spent in jail, or bring back the baby that she miscarried. Plaintiff Michael Koss, a Marine Combat Veteran, cannot get back the last 7 years that felony charges have been pending against him and his wife, utterly altering their lives and family. 14. The tragedies that Hertz—who files thousands of police reports per year—has caused could fill many books. 15. Hertz, a company which claims to be Number 1 in customer service, has been given every chance by Plaintiffs to voluntarily address what they are doing to their customers, but the response has been callous disregard. 16. There is no excuse for this conduct. The criminal justice system does not exist to be used as a repo service for a massive multinational company worth billions of dollars which cannot be bothered to track its vehicles and rentals. No company should be mass filing unverified police reports, especially when those false reports endanger the freedom and safety of its customers and disproportionately impact minorities. Background on Hertz Theft Reporting and the Serious Issues Hertz Corporate has Been Ignoring for Years 17. Any theft report must be undertaken with the utmost seriousness given that it has the potential to ruin a customer’s life. Hertz therefore has several corporate policies which are supposed to govern theft reporting by the company. These policies are allegedly designed to safeguard against false reports. In reality they are ignored and twisted to cut costs resulting in false theft reports. 18. Hertz and its subsidiaries are Delaware corporations. Hertz also has approximately 15 corporate security managers who participate and supervise the theft reporting process at the various locations around the country. Page 6 of 92 19. When a vehicle is missing or is allegedly overdue, Hertz Vehicle Control generates what Hertz calls a “theft package.” This theft package is then given to the police to initiate a theft report. This theft package purports to detail all contact with the renter, payment information, the rental due date, extensions made by the renter, and the renter’s prior rental history. 20. Hertz has a major systemic failure in that it is filing false theft reports. These can be categorized as missing inventory and overdue rentals. 21. Missing inventory reports are self-explanatory, and generally consist of vehicles allegedly missing from Hertz locations without permission where Hertz does not know what happened to the vehicle. In these cases, Hertz reports only the car stolen and does not name a customer in the theft report. 22. Overdue rental reports occur when the renter has allegedly kept the rental past the due date and has not extended or contacted the company. In these cases, Hertz personally names the renter as having stolen the car. 23. Although the title of the applicable crime varies from jurisdiction to jurisdiction, the law generally provides something to the effect: (a)  A  person  is  guilty  of  theft  of  rental  property  if  the  person,  with  the  intent specified in §  841 of this title, takes, destroys, converts, wrongfully  withholds  or  appropriates  by  fraud,  deception,  threat,  false  token,  false  representation or statement, or by any trick, contrivance or other device  to  avoid  payment  for  or  to  otherwise  appropriate  rental  property  entrusted  to  said  person.  For  purposes  of  this  section,  “property”  shall  include the use of vehicles or other movable property.  Del. Code tit. 11 § 849. 24. The classic example of such a type of car theft is where a vehicle is rented with the intent of never returning or paying for it. The “renter” simply absconds with the car. Page 7 of 92 25. Contrarily, any renter extension, contact with the company, payment, or prior rental history with Hertz is a clear indication that the renter has no intent to steal a rental car. There may be civil issues that arise during a rental, but they are not disputes for the criminal justice system. 26. Yet, many customers who were the subject of theft reports by Hertz have claimed that they were reported to the police despite extending their rental, being in contact the company, paying, having a prior rental history, and otherwise not breaking the law. 27. How could this happen? 28. Hertz has several nationwide systemic problems which are resulting in blatantly false police reports for both missing inventory and overdue rental cases. This is resulting in innocent customers being thrown in jail and prosecuted, a massive civil rights issue. Unfortunately, this problem predominantly and invidiously affects black and minorities. 29. These systemic issues are well known to the company but have been ignored for many years because fixing them would decrease Hertz’s profits. 30. The systemic problems cause blatantly false police reports to be submitted, resulting in the arrest and prosecution of customers without probable cause both for missing inventory cases and for allegedly overdue rentals: a. Falsification of Payment Information - Hertz’s theft reports falsely tells the police the renter never paid and provided a denied card. Secretly, however, Hertz actually fully charges the customer but never updates the police with the payment information. Incredibly, Hertz policy W7-02(D) specifically describes and requires this outrageous process, which guarantees that every Hertz theft report contains falsified payment information. b. Deletion of Rental Extensions - In certain scenarios Hertz’s computer systems secretly delete customer rental extensions, and backdate the rental due date, resulting in false police reports which claim that the renter never extended or contacted the company. Not only do customers believe they have an extension, but sometimes this extension process occurs over and over during the rental with the renter having no idea there is an issue. Hertz’s systems provide no indication to employees who handle extensions that there is a problem with the rental so the customer is also not informed of the issue. The customer who believes the rental is extended, is then suddenly arrested despite having been in contact with the company. Page 8 of 92 c. Failure to Perform Adequate Investigation - Hertz has directed its vehicle control and corporate security personnel to violate Hertz policy W7-02(a)(17) which requires an investigation by a corporate security manager to confirm the accuracy of theft reports. Instead, Hertz has told the local security managers that their “marching orders” are to refrain from verifying, investigating, or otherwise double checking police reports for extensions or payment. This results in every Hertz theft report being unverified. Because no investigation or check is performed, every Hertz theft report contains significant inaccuracies regarding due dates, extensions, payments, customer contacts, returns, and other important information. d. Destruction of Records - Despite criminally reporting customers for theft, and being required by Hertz policy and the law to preserve all related information, Hertz outrageously deletes almost all renter information and data. This information and data often contains proof that the renter paid and extended the rental, that the renter had no intent to steal the car, and that Hertz’s initial theft report was false. In a prior lawsuit, the Court granted severe spoliation sanctions against Hertz for its destruction of documents. 31. These systemic errors are explained in more detail below. 32. For allegedly overdue rentals, authorities pursue charges is because they rely on Hertz’s false theft package which claim that: (1) the customers did not pay, (2) the customers did not extend or contact Hertz, (3) that Hertz internally verified the accuracy of the report, and (4) that there is probable cause to conclude that the customers have criminal intent to steal a vehicle. 33. The authorities are unaware that the theft package is unverified, one-sided, does not fully capture the rental histories of the customer, fails to record and erases extensions, backdates due dates, contains false payment information, and that Hertz destroys all internal data which could exonerate the customer and contradict the theft package. 34. For allegedly missing vehicles, authorities pursue charges is because they rely on Hertz’s false theft package which claim that :(1) they believe Hertz’s theft package which says that the only way the vehicle could be missing is that it was stolen off of Hertz’s lot, (2) they have no idea that Hertz routinely loses track of cars, (3) they do not know that instead of investigating where missing cars are, Hertz simply reports them stolen and has the police find them, and (4) they do not know that Hertz does not note in its rental system which cars it reported as “stolen,” resulting in customers being rented stolen cars. Page 9 of 92 35. Invariably, when the prosecution and police are informed that the customer had in fact paid for the rental, returned the rental, extended the rental, or was rented a stolen car the charges are dropped. 36. Perniciously, despite filing these police reports, Hertz never intends to pursue a prosecution to trial, yet also never withdraws the cases. Instead, it lets the case linger while the innocent customer either sits in prison or is prosecuted. When the renter contacts Hertz to ask for help, Hertz falsely tells the customer that it is out of Hertz’s hands whether to continue the prosecution. 37. For what purpose would Hertz be filing false police reports but not actually pursuing prosecutions? The answer is that Hertz has realized that it is exponentially cheaper to simply file criminal theft reports against customers—even if they are false. 38. By reporting missing or overdue vehicles to the police, with little or no investigation or verification, Hertz gets the following benefits: a. Hertz avoids spending money on personnel to verify if the theft reports are accurate; b. The police immediately recover the vehicle at taxpayer expense, instead of Hertz hiring repossession services; c. If Hertz treated these rentals as a civil and not criminal issue, the rental contracts require that these matters be arbitrated. If Hertz arbitrated these matters it would cost an enormous amount of money. By filing a criminal report, Hertz avoids arbitration and instead receives restitution through the criminal justice system; d. Hertz writes off the rental car and/or makes an insurance claim for the “stolen” property. 39. If this seems incredible, it is all documented in Hertz’s own policies and testimony, as described below. Page 10 of 92 Hertz Falsifies Payment Information in Police Reports to Secure Illegal Arrests & Prosecutions 40. In every theft report there are two implicit variables: payment and time. 41. If the rental vehicle is paid, or the renter has provided Hertz a valid form of credit (e.g., a credit card number), it should be clear that the renter does not intend to steal the car. Indeed, in any type of consumer theft report, the determinative factor is payment. 42. Hertz routinely provides false information to the police in its theft packages about customer payment to secure criminal charges against the renter. To understand how and why, some background is needed on Hertz’s billing process. 43. When a customer initially rents a car from Hertz, they provide a credit card to Hertz as a letter of credit so that Hertz can charge for any costs associated with the rental. 44. At the time of the initial rental, Hertz puts something called an “authorization hold” on the customer’s card. An authorization hold is not a permanent charge, it simply checks the customer’s account to see if it is valid and has funds. This temporary charge does not appear on any monthly billing statements, and is not a bill or payment. 45. If the customer later extends the rental, Hertz also places an authorization hold on the customer’s card. Again, this is not a final billing or payment. 46. Only at the end of the rental, after the rental is closed out, does Hertz actually charge the customer’s card for payment on the full rental. 47. Although, an authorization hold may be denied during the rental for a variety of reasons, such as a low balance, this says nothing about whether the final billing charge will go through. 48. When filing theft reports, Hertz first finalizes and prints out paper theft packages compiled in Oklahoma City which claim that the customer never paid for the rental and that the Page 11 of 92 card was “denied.” However, when the theft package is printed out, the customer has not yet been billed. The paper theft packages state that the customer owes the full balance of the rental. Then and only then, after the theft package is printed out, does Hertz charge the customer for the car rental. The final billing charge is almost always successful. 49. Yet, despite having just charged the customer and received payment, Hertz then gives the now out-of-date paper theft package to the police claiming that the renter never paid, has an outstanding balance of many thousands of dollars, and that the renter provided an invalid card. 50. At no point does Hertz inform the police that the customer has been charged. 51. As is immediately obvious, this means that many if not all overdue Hertz police report contains materially false information. 52. Incredibly, this is not the result of some sort of massive error, but instead has been deliberately written into Hertz’s policy since at least 2007: Exhibit 1 - W7-02 Theft Reporting Policy. 53. The reason the policy is written in this manner is because Hertz knows that if police were aware that Hertz had charged the customer, and always had a letter of credit to bill the customer at its discretion, the theft report would not be accepted. Page 12 of 92 54. Indeed, when the customers provide proof of payment to the prosecutors, the prosecutions are dismissed. 55. Hertz has known about this issue for many years but has stubbornly refused to revise the policy. Given that Hertz files at least 10,000 police reports a year, and this policy has been in place since at least 2007, the number of affected individual is huge. 56. Every named Plaintiff reported for overdue rental theft was billed by Hertz after the theft report was printed out; in no cases were the police were told about the payments. 57. This policy is at a minimum reckless, it is a corporate device to obtain police action against customers where there is otherwise no probable cause to do so. There is no legitimate or valid reason for such a policy. 58. All corporate Hertz defendants and their employees, the named defendant directors, and the named defendant officers were aware of this policy and refused to change it or otherwise take action. 59. In September 2017 Hertz lost a malicious prosecution trial in Philadelphia. As with Plaintiffs’ cases explained in this Complaint, Hertz had given a theft package to the police which said she owed $2,445, when in reality Hertz had received payment of $2,445 a week before the police report. 60. Hertz’s national supervisor for Vehicle Control, Julie Wilkerson, attempted to dissemble on the witness standard about whether Hertz had told the police about Grady’s payment: COUNSEL:   Do  you  believe  if  there's  ‐‐  I  think  you  testified  if  there's  omitted  facts,  they  should  be  corrected,  correct?  WILKERSON:   Yes.  COUNSEL:   Eventually did Hertz become aware of additional facts  in regards to Ms. Grady's rental that should have been  provided to the police?  WILKERSON:   Which facts?  Page 13 of 92 COUNSEL:   Well, the payment of $2400.  WILKERSON:   That  was  actually  in  the  theft  package.  The  police  had  that information.  COUNSEL:   The police had that information?  WILKERSON:   Yes, it's in the billing page of the theft package.  Exhibit 4 - Wilkerson Testimony, at pp. 5-6 (emphasis added). 61. This testimony was untrue. Wilkerson supervised Hertz vehicle control for many years, and she was—and is—well aware that a theft package provided to the police never contains payment information for the simple reason that the renter is charged only after the theft package is generated and taken to police. See Exhibit 1 - W7-02(D). 62. When she later tried to repeat her misstatement, she was impeached and ultimately forced to admit that her testimony was untrue: COUNSEL:   Ma'am, I'm asking you was 2445 paid, yes or no?  WILKERSON:   Yes.  COUNSEL:   And that information was never updated to the police,  correct?  WILKERSON:   No.  COUNSEL:   It  was  not  corrected,  correct?  It  was  not  updated  to  the police, correct?  WILKERSON:   They had the information.  COUNSEL:   I'm asking you if the information that it was paid was  updated to the police, yes or no?  WILKERSON:   The police actually have the theft package and this was  in the theft package.  COUNSEL:   Ma'am,  you  just  identified  that  that  is  not  a  payment  for  2445,  it's  what  is  owed.  Do  you  understand  the  difference between ‐‐  WILKERSON:   Yes.  COUNSEL:   ‐‐ money in your bank account ‐‐  Page 14 of 92 WILKERSON:   Yes.  COUNSEL:   ‐‐  and  what  is  owed  to  you?  It's  the  difference  between an asset and a liability, right?  WILKERSON:   Yes.  COUNSEL:   Okay. Understand the difference?  WILKERSON:   Yes.  COUNSEL:   You deal with this every day?  WILKERSON:   Yes.  COUNSEL:   So let's be clear. The police didn't know $2445 was paid  before  they  signed  an  affidavit  of  probable  cause  allowing  Ms.  Grady  to  be  arrested,  correct?  Correct,  ma'am?  WILKERSON:   Correct.   COUNSEL:  No further questions.  Exhibit 4 - Wilkerson Testimony, at pp. 54-55 (emphases added). 63. Wilkerson’s evasive testimony demonstrates that she and Defendants were always well aware that it is impossible for theft packages to show renter payments; Hertz policy mandates that the renter’s credit card be charged after the theft package is generated. Hertz Erases Rental Extensions and Backdates the Rental Due Date 64. As noted, every rental theft report is based on two main variables: payment and time. In addition to misrepresenting payment, Hertz also utterly botches the time component of the overdue vehicle theft reports. 65. In sum and substance, after renters extend the rental period, Hertz’s computer systems outrageously deletes the customer extensions without notice to the customer. 66. When a customer calls in to Hertz to extend the rental, the renter can call the location or Hertz corporate’s 1800 extension number. When the customer extends, Hertz then Page 15 of 92 places an authorization hold on the card. If the authorization hold is approved by the bank, then the extension appears on Hertz’s records. 67. However, if the authorization hold is denied, Hertz’s computer systems at Vehicle Control erase the extension and backdate the due date of the rental. Not only is the customer not informed of the voided extension, but the deletion is also not apparent to Hertz employees.2 68. To be very clear, when the Plaintiffs allege that Hertz erases the extension what they mean is that Hertz’s computer programs completely erase any evidence not only that the renter ever extended, but that the renter ever attempted to contact Hertz in the first place. 69. The problem is immediately apparent to even the most cursory observer. The renter has been told that he is authorized to use the car for an extended period, yet Hertz has secretly canceled the extension and erased any evidence it ever existed. 70. It is one thing if Hertz wants a new form of payment and lets the customer know; it is something else entirely if Hertz memory holes the rental extension. In some cases, the renter has extended over 10 times and each time, without notice to the renter, Hertz secretly erased the extensions. 71. Hertz then reports the customer to the police claiming that the due date of the rental was months before and that the renter never extended or contacted Hertz about the rental. This information not only goes directly to whether the renter extended and was authorized to use the vehicle, but also is vital information about whether the renter had actually absconded with an intent to steal the vehicle. No exculpatory information from the Contract Notebook is given to the police. 2 Although the extension is erased, the Contract Notebook which contains a history of the rental contacts (which is not consulted by Vehicle Control), can retain information showing that the renter had contacted Hertz. Page 16 of 92 72. A perfect example is plaintiff Hanna “John” Ayoub. Mr. Ayoub rented from the Hertz location in Wilmington, DE at the Amtrak Station in early April 2019. He had rented many times before. He diligently extended his rental every week for one additional week, and had let Hertz know that he intended to rent the vehicle through at least late May 2019. 73. On April 15, 2019, he called the Hertz location, as was his routine, to extend for another week. A Hertz employee named Kelsey told him that he was good to go and that Hertz had hit his card for $308. In fact, he received an app alert from Capital One that a pending authorization hold for $308 had pinged his account. 74. Bizarrely, the next day, the Hertz Wilmington location called him and told him the car was overdue and asked if he wanted to extend. Mr. Ayoub was understandably confused, and insisted that he had just extended the day before. The Hertz employee was adamant that the computer system showed no extension or renter contact on April 15, 2020, despite the fact that Mr. Ayoub knew he had called. 75. After a long phone call, Mr. Ayoub grew frustrated and simply started extending with Hertz corporate at the 1800 number because the location was not being responsive. 76. He has detailed phone records showing phone calls with Hertz corporate every 7 days extending the rental through June 2019. 77. What Ayoub did not know was that on April 15, 2019, the authorization hold showing up on his credit card records was denied. This resulted in Hertz’s system erasing his rental extension. He was never told any of this. 78. Ayoub then tried to extend again, and was similarly ignorant that his 10 additional rental extensions through June 2019 were apparently also erased without notice to him, because no one from Hertz ever called him or told him there was an issue. Page 17 of 92 79. On May 7-8, 2019, he received emails from a Hertz investigator who claimed that the Wilmington location had a hold on the vehicle and that it had to be returned. However, he spoke with Wilmington and confirmed that he was authorized to have the rental. 80. Unaware there was an issue, Ayoub was charged $2,309.74 on May 24, 2019. He saw the charge and spoke with Hertz whose employees assured him rental was in fact continuing. In actuality, unknown to Ayoub, Hertz reported the truck he was renting stolen on May 28, 2019. 81. Hertz had falsely told the police that Ayoub never paid for the rental, that it was due on April 15, 2019, and that he not extended. None of this was remotely true. Hertz also told the police that Ayoub said he would return the vehicle on May 8, 2019, but fraudulently neglected to tell police that Ayoub had in fact then confirmed with the Wilmington location that he was authorized to have the rental. 82. Like many police reports by Hertz, the entire theft package regarding Ayoub was a fiction created by horrendous policy and practices that Hertz has known about for years but done nothing to fix. 83. As a result he was arrested, jailed, and prosecuted. Hertz’s Failure to Investigate Theft Reports Results in Illegal Arrests and Prosecutions 84. It is egregious that false information regarding payment and extensions appear in Hertz’s theft packages, but even a simple investigation and verification of these theft packages would prevent false information about customer from being given to the police. 85. However, no investigations take place in violation of Hertz’s own policies. 86. The theft package is compiled in Oklahoma City by Vehicle Control by largely automated processes. Under Hertz policy W7-02(a)(17), after the theft package is sent to the location, the local corporate security manager is then supposed to investigate and verify the accuracy of the theft package: Page 18 of 92 Corporate/Country  Security  Manager  Investigations  ‐  Every  theft/conversion/disappearance  must  be  promptly  investigated  by  the  Corporate/Country  Security  Manager  responsible  for  the  location  from  which  the  related  Theft  Vehicle  Report  is  filed.  All  employees  are  required to cooperate fully with such an investigation.  See Exhibit 1 - W7-02 Theft Reporting Policy. 87. The policy is unambiguous. Yet, in that prior Philadelphia case against Hertz which resulted in the 2017 malicious prosecution verdict, a Hertz corporate designee admitted that the corporate security managers have been told by corporate to not perform the required investigation: COUNSEL:   Is  it  your  testimony  that  you  don't  go  to  the  location  and  question  any  of  the  Hertz  employees  when  you  receive a theft package?  MR. LIVINGSTON:   That's my testimony, yes.  COUNSEL:   Why?  MR. LIVINGSTON:   Because  I  mean  the  package  has  been  completed,  all  the reports have been reviewed, I guess, by OKC. And  my marching orders are to report the car stolen when I  get  the  ‐‐  again,  I  do  look  at  it  for  everything  being  accurate, as far as I can tell, within the report itself.  COUNSEL:   Yeah. But you don't do any independent investigation?  MR. LIVINGSTON:  I do not.  COUNSEL:   You don't do any check?  MR. LIVINGSTON:   I do not. Exhibit 2 - Livingston Testimony, at p.194-96, 115-117 (emphasis added) (objections omitted). 88. This was confirmed by another designee, a manager for the company: COUNSEL:   We deposed Mr. Rich Livingston Tuesday. He indicated  that he doesn't put the package together. He just gets  it from Oklahoma City and then basically just couriers  it  to  the  police.  Is  it  your  understanding  that  the  corporate  security  manager  or  assistant  corporate  security  manager  actually  puts  the  theft  package  together?  Or  is  it  your  understanding  that  the  theft  package  is  put  together  in  Oklahoma  City  and  then  Page 19 of 92 sent to the corporate security manager at the location  where the car was allegedly taken from?  MR. JAUSSI:   So it's my understanding that Oklahoma City generates  the  packet  and  all  the  pertaining  documents  within  it,  feeds  Ken  Graeber  or  Rich  Livingston,  right,  and  Ken  Graeber or Rich Livingston essentially print, file, and go  seek a police report claim or case number.  COUNSEL:    Okay.  So  the  theft  package  is  already  completed  in  Oklahoma City before it's sent to the corporate security  manager  at  the  Hertz  location  where  the  car  was  allegedly taken from, correct?  MR. JAUSSI:    That's my understanding, correct.  Exhibit 3 - Jaussi Testimony, at pp. 69-70 (emphases added) (objections omitted). 89. According to Livingston, corporate security personnel do not even have access to rental information to verify the accuracy of theft reports. COUNSEL:  Do you have access to phone logs to determine when  a renter called in?  MR. LIVINGSTON:   I do not.  COUNSEL:   Do you have access to any kind of logs that determine  the contacts the renter had with Hertz?  MR. LIVINGSTON:   Do not.  Livingston Testimony, at p. 205. He also confirmed he does not attempt to ascertain whether a customer was billed, nor does he engage in any discussion with the location employees about the rental or the renter. 90. Hertz’s policy also requires that every missing vehicle and overdue rental theft report have a checklist completed to make sure that due diligence has been done before reporting the vehicle stolen. See W7-02(a)(4). Hertz also ignores this requirement of the policy, and does not complete the required checklist for any theft report. Page 20 of 92 91. A simple investigation that complied with W7-02 of Hertz’s systems would reveal customer extensions, attempts to extend, customer contact with Hertz, and payments which would reveal that the theft package is materially false. 92. Note the contrast to the payment issue. There, W7-02(D) is an absurd policy instituted and maintained by the company. Here, the policy reasonably requires an investigation to verify the accuracy of the theft package, but Hertz deliberately instructs employees to disregard the black letter policy. Unconscionably, this policy is supposed to be a safeguard that prevents false police reports. 93. As with the payment issue, Julie Wilkerson and Hertz have long known about this issue. Wilkerson claimed at the Philadelphia trial that she expected her corporate security managers to conduct local investigations: COUNSEL:   In  fact,  this  is  a  procedure  [W7‐02(a)(17)]  that  you  follow  to  make sure that innocent people aren't wrongfully arrested for  accidental reporting to the police, correct?  WILKERSON:   Correct.  . . . .  COUNSEL:   Now, it says here that the question was asked of [Livingston]  or anyone working for him or working with him, if they did any  check and his response was no, not on his side of the fence.  Do you see that?  WILKERSON:   I do see that.  COUNSEL:   Now,  you  just  testified  that  he  would  have  checked  the  computer system of some sort, right?  WILKERSON:   He should have checked the computer system.  Exhibit 4 - Wilkerson Testimony, at pp. 37-46 (objections omitted) (emphases added). 94. Wilkerson and Hertz were not being candid: the company had told Livingston and all other US personnel not to check the computer system nor do any other sort of investigative check. Page 21 of 92 95. She was then constrained to admit that the failure to conduct local investigations violated Hertz’s policy W7-02(a)(17) in thousands of cases: COUNSEL:   How  many  theft  reports  have  come  out  of  Philadelphia?  MR. EDELSTEIN:   When?  COUNSEL:   In 2013‐2014, ma'am.  WILKERSON:   A lot.  COUNSEL:   A lot?  WILKERSON:   Yes.  COUNSEL:   And what would you say?  WILKERSON:   Maybe 2000.  COUNSEL:   Do you know – excuse me. Mr. Livingston testified that  he's  gone  into  court  and  handled  about  400  of  these  and  he's  never  done  a  local  investigation  to  determine  the truth and veracity of those theft packages?  WILKERSON:   No, I didn't know that.  COUNSEL:   That  would  fall  well  below  the  policies  and  procedures  of even Hertz Corporate policies, correct?  WILKERSON:   Yes.  Exhibit 4 - Wilkerson Testimony, at pp. 37-46 (objections omitted) (emphases added). 96. Despite Wilkerson’s false testimony, she knew at the time she testified that training materials from inside Hertz Vehicle Control actually direct employees to ignore the local investigation requirement of W7-02(a)(17). 97. It was stipulated by Hertz at the trial that Hertz was around that time cutting costs (and corners). Page 22 of 92 Hertz Improperly Destroys Its Records Relating to the Criminal Prosecution of Customers 98. Hertz policy specifically prohibits the destruction of records in contemplation of litigation, governmental investigation, or third party subpoenas—as does applicable spoliation law. 99. Furthermore, the company requires that any records related to a criminal prosecution of a customer be retained for seven years. 100. Yet, Hertz does none of this. Hertz instead deletes all recorded phone calls and all rental records including the Rental Contract Notebook, even for those customers who have been reported to the police for theft. 101. Those phone calls and rental records often contain information proving that the customer contacted the company and extended the rental. This information is exculpatory. Because Hertz does not provide customers in writing proof of extensions or contacts with the company, these are often the only records of what happened during the rental. 102. Notably, these records often completely contradict the what Hertz gives the police in the theft package. 103. Again, Hertz has known for years that this is a serious issue. In the 2017 Philadelphia trial, a Hertz designee testified that Hertz had purged and destroyed Grady’s rental file even though it reported her for theft and knew that investigations of its records were forthcoming: COUNSEL:   So you're telling me, as you sit here today, you're speaking,  just  so  you  know,  as  Hertz's  voice.  You're  the  corporate  designee,  the  person  most  knowledgeable  from  Hertz  to  testify  as  to  certain  things.  You've  been  identified  as  someone  to  speak  to  and  you've  identified  that  there  was  and  an  email,  that  you,  as  general  manager,  sent  to  Oklahoma City billing to determine whether or not the 2500  on  7/15  was  a  final  bill,  partial  payment,  full  payment  or  what it is, correct?  Page 23 of 92 JAUSSI:   Correct.  COUNSEL:   And  as  you  sit  here  today,  you're  telling  me  that  you  personally do not know whether or not that payment was a  final  payment,  or  that  payment  was  authorized,  or  that  payment cleared, or that payment was a partial payment or  a full payment, correct?  JAUSSI:   Correct.  All  they  stated  from  my  recollection  is  that  it  was  purged.  It's  been  purged.  There's  no  further  information  that  could  be  provided  because  that  contract  has  been  purged.  Jaussi Deposition, at pp. 37-38 (emphases added). 104. Hertz has not stopped destroying documents. The destruction is particularly pernicious because Hertz claims that its theft packages are accurate and complete, but it known that they are one sided and filled with false information. To keep up the façade, Hertz simply deletes the evidence showing otherwise. 105. Note that in the 2017 case, the police records showed that Hertz was called after the police arrested the customer and a Hertz representative, after researching the customer’s rental history, admitted that the police report for an overdue rental had been a mistake (because the renter had extended). The representative was looking at the customer’s information. It was this exonerating information that was purged by Hertz. Director and Officer Liability and Notice to the Corporation 106. Officers handle the day to day duties and run a corporation. Directors handle the overarching goals of the corporation. Both are supposed to provide oversight of the conduct of the business. 107. In doing so, the directors and officers establish rules which the corporation must follow. These rules are often known as standard operating procedures which govern the corporation’s conduct, both internally and externally. Page 24 of 92 108. Like any corporation, the primary goal is turn a profit. However, the company must do so in accordance with its standard operating procedures and the law. 109. In any rental car business, the company has to make sure that the customer is not wrongfully reported for car theft, and ensure that the police reports it files are true, accurate, correct, and that any materials are corrected. This is required in every state. 110. Every state requires that not only does the initiating party have probable cause to start a prosecution, but that any continuation of a prosecution also be supported by probable cause. 111. Within Hertz, the director and officers have promulgated standard operating procedures which are supposed to make sure that good, paying customers are not wrongfully arrested and prosecuted. 112. The directors and officers draft, promulgate, revise, and supervise these policies. 113. For instance, W7-02, the theft reporting procedure provides that “Location, Maintenance, Area, Country Head Office and. OKC Management must ensure compliance to this procedure.” All directors and officers have a duty to correct issues with Hertz’s theft reporting process if known to them, or if they should have known. 114. W7-02 provides that the Procedure Owner is “Senior Executive Vice President, Chief Administrative Officer and General Counsel.” 115. W7-02 provides that the Process Owner is “Vice President, Corporate Operations.” 116. As discussed above W7-02 is severely flawed both in its language, intent, purpose, and execution. 117. Some portions, such as W7-02(D), are poorly written and disastrously implemented. That section requires that theft reports be filed before the customer is charged, but the theft reports claims the renter’s card was denied and that the renter owes the money. Hertz never supplements payment information to the police, nor does any Hertz requires that Hertz employees do so. Page 25 of 92 118. In contrast, other portions of W7-02, such as (a)(17) and (a)(4), contain sensible and vital safeguards against false reports—but which the company has told employees not to follow. 119. For instance, subsection (a)(17) requires a full local investigation to verify and confirm the theft package compiled in Oklahoma City by Vehicle Control. Yet, Hertz corporate has directed that this local investigation not be done, and in fact the content of the package is not verified by location employees. 120. Furthermore, subsection (a)(4) requires that a standard checklist be completed for every theft report to make sure all steps are correctly completed before a theft report, and so that there is documentation showing that Hertz properly verified the theft report. This, too, is not done. 121. The failure of the Hertz corporate defendants, the directors, and the officers to address these issues is undeniable. The directors and officers are individually liable for these failures because they (1) participated in developing and implementing the theft reporting process, (2) knew about the problems with Hertz’s theft reporting process, and (3) negligently supervised and managed the theft reporting process. The Defendants have a duty to ensure that Hertz’s procedures are safe, effective, comply with the law, and comply with industry standards. 122. All corporate defendants (jointly known as “Hertz”) are alleged to be vicariously liable for the actions and omissions of their employees, including the individual Defendants. 123. These flaws with W7-02 and Hertz’s related policies and procedures have directly and proximately led to the Plaintiffs being wrongfully reported to the police, and wrongfully detained, arrested, imprisoned, and prosecuted. 124. As the testimony and evidence above show, Hertz’s top directors, officers, and managers have long known that W7-02’s content and implementation is severely flawed. Despite this they have done nothing. Page 26 of 92 125. First, W7-02 has been in place since at the latest 2007 as has Hertz’s general theft reporting process. It is poorly written and it is immediately obvious that it will result in materially false theft reports. Yet, despite being revised in 2009, 2015, and renamed in or around 2019, Defendants continue using this policy which virtually guarantees false theft reports. See Exhibit 1. 126. Second, in 2015, the chief of police at the Louisville Regional Airport Authority decided to limit Hertz theft reports due to Hertz submitting false police reports. His officers were told by Hertz employees that Hertz had an inventory control problem. His officers specifically notified Hertz Corporate Security of this serious problem. See Exhibit 5 - Emails from Louisville Police. 127. Third, in November 2016, the Indianapolis Airport Police similarly imposed restrictions on Hertz theft reports due to false reports leadings to the wrongful arrests of customers. 128. Fourth, in January 2017, Hertz was found liable for malicious prosecution and punitive damages in Texas, after it reported a man to the police who had never even rented a car from Hertz. He had notified the company his identity was stolen, but they reported him for theft anyway. 129. Fifth, in September 2017 Hertz lost a malicious prosecution and intentional infliction of emotional distress jury trial in Philadelphia, PA (the case was filed in 2015). Hertz’s national supervisor for theft reporting was confronted and impeached during testimony, and expressly told of the problems in this complaint. Hertz had falsely reported a customer for an overdue rental theft in 2013, but had failed to realize that she had extended and paid for the rental. When she was arrested the first time, Hertz told the police that it was a mistake and just a civil payment issue at most. However, Hertz then continued to prosecute her, and she spent 12 days in jail, and prosecuted her for nine months. Rather than turn over the exonerating information, it destroyed all the renter’s records. Page 27 of 92 130. Sixth, on November 14, 2017, Hertz’s general counsel and executive vice president defendant Richard Frecker was sent a letter by counsel detailing the theft reporting problems Hertz had. The letter spoke about how the Philadelphia court had ordered a punitive damages trial against Hertz, and notified Hertz of the Indianapolis case. 131. Seventh, in late November 2017, Nancy Cullen-Smits, who currently has a lawsuit pending in Virginia state court against Hertz, was arrested for two hours in a car she was renting. Hertz had lost track of the vehicle and had no idea the company had even rented the vehicle to her. Hertz made only trite attempts at apologies and Cullen-Smits elevated her concerns to the CEO, Kathryn Marinello. 132. Other lawsuits are also pending against Hertz in Florida (for a false report in 2008) and Ohio (for a false report in 2018) for identical conduct. 133. The Defendants have known since at the very latest 2017—and in reality well before—that Hertz has a serious issue and has been submitting false reports. The corporate and individual defendants’ failure to address these problems, which they had the ability and duty to do, imposes liability on them. 134. At no point did the directors and officers ever share the general public, or their shareholders, of the systemic failures which they knew to exist and did nothing address. 135. Directors and officers have responsibilities to the general public, the corporation, and the shareholders. Their compensation packages can be clawed back when they have engaged in inappropriate actions and omissions. 136. Additionally, the actions and omissions of the Directors and Officers have essentially used the police as a taxpayer funded repo service, and have needlessly wasted hundreds of millions of dollars of taxpayer money in an effort to cut costs, increase profits, and bolster their executive performance packages. Page 28 of 92 137. As a direct and proximate result of Defendant’s acts and omissions, Plaintiffs have incurred severe and substantial damages and actual harm. These damages include but are not limited to: a. Monetary damages; b. Fees incurred from criminal justice system; c. Physical injury; d. Severe mental distress, as well as severe emotional distress, mental suffering, mental anguish, sleeplessness, restlessness, anxiety, and depression; e. Loss of reputation; f. Loss of the time he spent unjustly incarcerated; g. Harm to personal, social, and professional relationships; h. Emotional pain and suffering; and, i. Lost wages. ***** Page 29 of 92 Parties 138. No Plaintiff knew about the widespread, systemic, and pervasive problems within Hertz, which give rise to this lawsuit, until at the earliest mid-2018. Plaintiff Nicole Stevens 139. Nicole Stevens is a citizen of Texas and was prosecuted in Harris County, Texas. 140. She is a 38-year old mother of 10 children (plus a nephew she has cared for since he was an infant). 141. On April 18, 2018, Plaintiff Nicole Stevens rented a car from the Hertz location in Jersey Village, TX to help with childcare needs. She was a Hertz Gold Club member. 142. She called the 1-800 Hertz number for extensions and extended the rental several 143. At some point in late May or early June 2018, Ms. Stevens called the Hertz 1-800 times. number for roadside assistance, and told Hertz to pick up the car because a tire on the car had hit a curb. At this point, Ms. Stevens was in Chicago. 144. Around the time of this call she spoke with an Arab woman in the billing department who confirmed that that Hertz was going to be towed to the Hertz location at O’Hare airport, and from there taken back to the Jersey Village location. 145. Ms. Stevens then continued traveling up to Minnesota where she has roots. She was told by someone in Chicago that the car had been towed. 146. A Hertz invoice shows that she paid a total of $1,101.25 for the rental to Hertz, and that her amount due to Hertz is “0.00”. 147. She moved on with her life and continued taking care of her large family. 148. However, Hertz and its employee, manager Christopher Green, had called the police on June 27, 2018, and accused Ms. Stevens of felony theft of a vehicle. Page 30 of 92 149. Hertz and defendant Green falsely told the police that Stevens “had rented a vehicle and never returned it”—despite the fact that Stevens had called Hertz to pick up the vehicle. Hertz also alleged that the vehicle’s return date was April 25, 2018, and that they never were able to contact her after her initial rental. None of this was true. 150. The false police report also claimed that she had taken the vehicle “with the intent to deprive the Complainant of the property.” The theft report also claimed that Stevens owed $1101.25 to Hertz. 151. This was bizarre because Stevens had extended the rental with the corporate phone number, and repeatedly spoke with both corporate HQ employees and Jersey Village, TX branch employees after April 25, 2018. 152. At no point were the misrepresentations and omissions in the police report corrected or withdrawn by Defendants. 153. Stevens was pulled over in October 2018 in Minnesota for wearing her seatbelt incorrectly. When the police officer ran her license, he returned to the car with his hand on his gun, said she had a warrant out for theft, and demanded that she get out of the vehicle. She responded, “I have 10 kids, I haven’t stolen anything.” He asked again, she got out, and he arrested her and chained her to a fence—she was totally baffled by what was happening. 154. Starting with her arrest, Plaintiff began a one-month hellish journey being transported in prison vans from Minnesota to Texas. 155. Conditions were gross and humiliating and included repeated strip searches, cells the size of dog kennels, and being forced to wear the same panties and bra for one week with no changing or washing. Female inmates with prurient interests in mind placed their hands on her and attempted to sexually assault her. Page 31 of 92 156. When the jail finally began to transfer her to Texas, it was not a straight-shot 16- hour drive. Instead, it was a circuitous route to 5 different jails all over the country. She and the other inmates were shackled on their wrists and ankles. Any movement tightened the cuffs which dug into her skin and bone. She was stuffed in the front of the van with two other inmates and was forced to sleep sitting up. 157. Upon arriving in Arkansas, she was then jailed there for ten days while she waited for further transfer to Texas. The Arkansas jail was awful. At one point, the first floor of the jail flooded with raw sewage forcing Stevens and the fellow inmates to sit on tables. 158. After her stay in Arkansas she took a prison bus (a Greyhound type bus with cages installed for each seat) to a prison near the Rio Grande, and was then put in another prison van and transported for 5 to 10 hours at night to the Harris County lockup. 159. She then sat in prison for three more days before being released. 160. Despite the fact that Hertz knew she had returned the car, she was told by the court personnel when she showed up to multiple hearings from November 2018 to June 2019 that the Hertz employee who reported her, defendant Green, was the one who had to withdraw the allegation. This was never done by Green, Hertz, or anyone else. 161. At no point was there probable cause to continue with the prosecution. In addition to having never been filed, the report and prosecution should have been withdrawn immediately. 162. It was only in June 2019, after paying for an attorney and attending several court hearings (which were repeatedly continued), that she learned that the prosecutor had dismissed her case. 163. The dismissal stated: “no probable cause exists at this time to believe the defendant committed the offense”. 164. Stevens suffered severe mental and emotional damages, which included Page 32 of 92 miscarrying. Plaintiff Shontrell Higgs 165. Shontrell Higgs is a citizen of Florida and was prosecuted in Broward County, Florida. 166. Higgs started a Hertz rental on February 28, 2019, with at TD Bank card. She extended the rental on March 1 (to March 7), March 6 (to March 14), March 12 (to March 29), and March 21, 2019 to (April 10). She has phone records proving these phone call took place. She also spoke with Hertz on March 8, 2019. 167. On the March 21, 2019 call she provided Hertz with a new Walmart Money Card because there was a billing issue with the TD Bank card. As part of the continuing rental Hertz placed authorization holds on that card on March 21 and March 28. 168. On April 5, 2019, Higgs received a call from a woman named Jordan who said she worked for Hertz and wanted to know when Higgs was retuning the car to make sure it was not reported stolen. Higgs told her that she had extended to April 10. Jordan said that this was fine. 169. Then at 12:15 pm on April 9, 2019, Jordan and Higgs communicated again by text message about returning the rental on April 10: Page 33 of 92 170. As can be seen, Hertz knew when Higgs was going to return the vehicle. 171. However, unknown to Higgs, Hertz had already reported Higgs for car theft on April 5, 2019. The theft package claimed that she had not extended the rental and that she had not paid for it. The theft report said nothing about Higgs providing Hertz on March 21, 2019, with a new credit card and Hertz extending the rental to April 10, 2019. Bizarrely, Hertz’s investigator only contact Higgs after the police report was filed and never told her that a police report was filed or that there was a serious issue with the rental. 172. Just a few hours after texting with Jordan about the upcoming return, Higgs was arrested while getting take out with her godmother. She was utterly baffled. 173. Higgs was jailed for 37 days, and not once did she speak with her public defender. While in jail she found out she was pregnant, missed her nursing school graduation, could not work, and was separated from her finance and two children. 174. At her first preliminary hearing, upon the first time speaking with her public defender, she was presented with a prearranged plea deal and told that she had to take a no contest plea or spend another 4 months in jail waiting for another hearing. Utterly confused and terrified she pled no contest, but then shortly thereafter filed a motion to withdraw the plea. It is still being litigated. 175. At no point has Hertz informed the prosecutors that the police report was false, that Higgs extended the rental, that Higgs’ paid $1,057 for the rental, or otherwise asked to right this wrong. 176. After being released from prison Higgs tragically miscarried. Then, because Higgs had not paid restitution to Hertz, she was rearrested. In total, Higgs spent 171 days in jail solely as a result of Hertz’s false police report. 177. Her motion to withdraw her plea is pending in the Florida 4th District. Page 34 of 92 Plaintiff Julius Burnside 178. Julius Burnside is a citizen of Mississippi and was prosecuted in Gwinnet County, Georgia. 179. On December 26, 2017, Mr. Burnside’s insurance company rented him a car from Hertz. He provided a valid debit card from Fifth Third Bank. He spoke with Hertz during that time period and told them everything was fine with his rental. 180. On or around February 7, 2018, he took over the rental from the insurance company. He extended the rental on the corporate extension number. When he would extend, an authorization hold for $320 would appear on his Fifth Third Bank app. 181. He continued to extend, with the last extension being until the end of March or early April 2018. 182. Hertz charged Burnside’s card $2,343 on March 26, 2018, and he figured everything was fine. He returned the rental on April 2, 2018. 183. Unbeknownst to him, Hertz had reported Burnside to the police on March 27, 2018, for car theft. Hertz falsely claimed that Burnside did not pay for it and did not return the rental car to its Norcross location by a due date of February 17, 2018. 184. Hertz also falsely told the police that they had attempted to contact Mr. Burnside about the overdue rental but that he had ignored them. 185. As a result of Hertz’s allegations, Burnside was charged with Theft by Conversion, and was accused of failing “to make a specified return of the vehicle” by February 17, 2018, while “knowingly convert[ing] said property to his own use in violation of the agreement.” Exhibit 5 - Police Documents. 186. Burnside only learned about this charge and the warrant for his arrest on April 11, 2018, and turned himself in totally confused. After a short jail stay, he was let go. Page 35 of 92 187. Given that he had returned the car on April 1, 2018, had paid in full, and had always been in touch with the company he assumed that someone had made a mistake which would be quickly corrected. Why would he possibly be prosecuted for theft of a rental vehicle he had returned and paid for? 188. He contacted Hertz and asked them to take care of this obvious issue, and assumed it was being taken care of. 189. However, due to taking care of a relative out of state, Mr. Burnside missed a hearing date and Hertz had never withdrawn the prosecution. As a result, Burnside was arrested by a bounty hunter, and then held in jail for 6.5 months. Not only was he ripped way from his family, but he was working two jobs which earned approximately $80,000 a year. 190. During those 6.5 months, he stubbornly refused to plead guilty despite the insistence of prosecutors and maintained that he had always extended and spoke with Hertz. However, after his family asked him to swallow his pride, he pled guilty to the alleged crimes so he could return to them in September 2019. 191. Upon his release, he then did some research and found online that Hertz was notorious for losing rental extensions and filing false police reports. He then filed a motion to withdraw his plea with the benefit of counsel, and not only was his plea withdrawn but the prosecution dropped all charges against him. Plaintiff Magalie Sterlin 192. Magalie Sterlin is a citizen of Florida and is being prosecuted in Broward County, Florida. 193. Sterlin rented a car on April 17, 2017, for 1 week, and then extended it at least three times to early to mid May. Page 36 of 92 194. At all times during the rental, Ms. Sterlin was in contact with Hertz personnel who knew that she did not intend to steal a car. 195. On or around May 9, 2017, Hertz told Sterlin that the vehicle’s registration was expiring and because of that she should exchange the vehicle for a new rental car. 196. She was also told on or around May 10, 2017, that if she extended the rental that she could ignore any communication from Hertz about the vehicle being overdue. 197. Ms. Sterlin was in close contact with Hertz, who knew that she was not absconding with the vehicle. 198. On May 24, 2017, Hertz’s charged Sterlin $1,546.21. Sterlin had also spoken with Hertz and was set to return the vehicle on May 29, 2017. 199. Sterlin was arrested on May 28, 2017, and charged with failure to return a rental vehicle. 200. Hertz had filed a false police report on May 25, 2017, claiming that Sterlin had not paid for the rental and had a net due of $1,546.21, and also claimed it was overdue. 201. Even if the vehicle was overdue, Hertz knew that at no point was there any intent to steal the vehicle. 202. If the classic example of rental car theft is someone who fraudulently rents a car with an invalid card and never talks to the company again, then Sterlin’s case bears no similarity to such a crime. 203. This was not a situation where the renter refused to speak with the company, or provided an invalid card. Instead, the company simply wanted the vehicle back because of an upcoming registration expiration. 204. This is not a circumstance where a private company should be filing (false) police reports to essentially use the police to repossess car. Page 37 of 92 205. Defendants made only bare, minimal efforts to repossess the vehicle themselves without resorting to police action against a customer. 206. Sterlin is still being prosecuted by Defendants almost three years later. Plaintiff Arthur Stepanyan 207. Arthur Stepanyan is a citizen of North Carolina and was prosecuted in Mecklenburg County, North Carolina. 208. Plaintiff is a longtime VIP Hertz customer at the Charlotte Airport location, and is a Gold Club Member. His credit card has been on file for years. If there are any problems with his rental, then Hertz simply calls him on his phone number. He is well known at the location. 209. In early March 2019 he rented a Silver Dodge Ram from the Charlotte location, and then returned it two weeks later on March 14, 2019. On March 16, 2019, he reserved a Ford 150, but after arriving at the location decided he did not like the F150 because it did not have a trailer hitch. Hertz then convinced him to rent the Dodge Ram from his prior rental instead and gave him a deal. 210. Hertz’s employees did the paperwork and he left the lot with the Silver Dodge Ram. The Hertz employee in the booth guarding the lot checked his paperwork before he left to make sure his rental was okay. Everything was normal to Stepanyan’s knowledge and the same as any other car rental. 211. Mr. Stepanyan was unaware that Hertz had erroneously listed a Ford 150 on his rental contract, not the Dodge Ram, and failed to catch the error at the booth when he left the lot. All of this was negligent and reckless. Mr. Stepanyan continued with his rental and received no calls from Hertz that anything was amiss; in the past, if there was an issue he would be called. Stepanyan knew that Hertz would bill him at the end of the rental for the full amount of the rental on the card he had provided. Page 38 of 92 212. As Plaintiff was driving on August 5, 2019 in the Silver Dodge Ram he noticed a police car abruptly start to follow him without its lights on. He figured it was because he was not wearing his seatbelt. 213. However, then 4 or 5 police cars were following him without his lights on. Plaintiff was scared, but also not entirely sure what was going on or who they were after. By the time he pulled into his house there were 10 to 15 cars following him who then arrayed themselves in front of his house. At this point the lights came on, they were all screaming “show me your hands,” and many guns were pointed directly at him. They were also screaming “don’t turn around.” 214. This was one of the most terrifying moments of his life. He asked them over his shoulder with his hands up “All this for a seatbelt ticket?” and was told to shut up. This happened in front of his neighbors. 215. After about two minutes, they shackled him and accused him of car theft. They said the car he was driving was reported stolen. 216. He was shocked, and told them to look in the glovebox for the rental agreement. He also gave them the number of the Hertz VIP associate at the Charlotte location who knows him well, whom he believes is named Jordetta. 217. During all this he was sitting handcuffed in the back of a police car. The cuffs were so tight that his thumb now has permanent nerve damage and feels like a piece of plastic. 218. However, when he and the police called the VIP associate at the Charlotte location and attempted to explain the situation, she hung up the phone. They called back three or four times from multiple numbers and she refused to pick up. 219. The police spent three hours on the phone trying to contact Hertz corporate, but got the run around. The police persisted in calling because they could tell that this was not a normal stolen car report and they did not want to arrest him. Page 39 of 92 220. When the police finally got in touch with someone at Hertz corporate, the representative said “we don’t see anything in the system but if you have a report then just arrest the customer.” 221. The entire time Plaintiff was utterly baffled, especially because the police told him that the police report did not name him but only said that the vehicle itself was stolen. 222. Given Hertz’s instructions the police had not choice but to throw him in jail. 223. He sat for 24 hours in a cell wondering how he had ended up in jail. The holding cell was extremely cold, making his time locked up miserable and torturous. 224. When Plaintiff bailed out of prison for $2,000, he went to the Charlotte airport Hertz location to figure out what had happened. He went to the VIP lounge and the representative named Jordetta was present. When she saw him walk in, her expression changed. 225. She claimed that when she was called during his arrest she thought it was a prank call and that is why she hung up. She claimed that only when he walked in that very second to the VIP lounge did she realize it was not a prank and that the police had been calling about him. This does not explain why she did not pick up phone calls from multiple numbers who were repeatedly trying to get in touch with her. 226. The VIP representative introduced him to a general manager for Hertz named David Nipper. Nipper is an area manager for Charlotte, NC for Hertz. 227. Plaintiff and Nipper discussed what happened, but Nipper said that he could not do anything about dropping the prosecution or fixing what happened. The only thing Nipper did was give Plaintiff the number for defendant Timothy Burrell, the corporate security manager responsible for Charlotte, NC. 228. It should be noted that it is positively absurd that, upon learning a false police report was made about one of your best customers, the response of the area manager was to give the Page 40 of 92 customer a phone number of someone else in the company. A responsible manager would have immediately been on the phone with Hertz corporate demanding that this be fixed and the prosecution withdrawn. 229. When Plaintiff called Burrell, who according to Hertz policy W7-02 (Theft Reporting) is directly responsible for all theft reports in Charlotte, NC, he was also told by Burrell that there was nothing he could do regarding the prosecution. 230. In fact, behind the scenes, instead of reviewing Stepanyan’s file to determine what had happened to a longtime customer, Hertz absurdly told the police to prosecute Stepanyan for failure to return the March 1 to March 14 rental—despite Hertz’s own records showing that Stepanyan had actually returned the car. This was, at a minimum, grossly negligent and reckless. 231. Even though Hertz had rented the Silver Dodge Ram to Plaintiff, it turned out that Hertz incredibly had no idea Plaintiff was driving the vehicle. When Hertz could not find the vehicle on its lot, the first thing Hertz should have done was contact the last known renter (Plaintiff) as a part of an investigation into the whereabouts of the vehicle. This step is mandated by Hertz policy and common sense. 232. Hertz reported the vehicle as stolen without doing any adequate investigation or verification to determine whether the vehicle had actually been stolen. Hertz, in fact, had no information the car was stolen. The investigation mandated by W7-02(a)(17) was not performed, nor was the W7-02(a)(4) checklist completed. Had the local security manager actually investigated Defendants would have realized the car was not stolen. 233. Hertz, however, decided to use the police as a repo service (subsidized by the taxpayers) to recover a vehicle it had lost track of, and filed a false police report in support thereof. Page 41 of 92 234. Not only does this expressly violate both North Carolina law and Hertz’s own policies (as described below), but it is shocking and outrageous behavior given that a false car theft report is certain to result in an innocent’s person’s arrest and imprisonment. 235. As described below, it is standard practice at Hertz to file unverified, incomplete, false police reports for the purpose of recovering vehicles the company has lost track of. 236. Eventually, the prosecution dropped the case against Stepanyan stating that the e “victim/business does not want to cooperate.” 237. Mr. Stepanyan has not only suffered physical injury, but also monetary damages, severe emotional distress, mental suffering, mental anguish, sleeplessness, restlessness, anxiety, and depression. Plaintiff Howard Junious 238. Howard Junious is a citizen of California and was prosecuted in Kern County, California. 239. On January 8, 2018, following an auto accident, Howard Junious’s insurance company, State Farm, initially rented a Toyota for him until January 14, 2018, from the Hertz Bakersfield, CA location. Mr. Junious provided a credit card ending for incidental expenses when he picked up the rental. 240. On January 12, 2018, rental notes in the Contract Notebook entered by Hertz corporate in Oklahoma City indicate that State Farm then extended the rental period to January 19, 2018.3 3 This single screenshot of one note (out of nine) from Junious’s Contract Rental Notebook is the only such note ever produced by Hertz in any of these cases. Despite these notes existing for every car rental, Hertz jealously hides these notes from prosecutors and police because they often contradict the theft packages, and deletes them despite knowing they are relevant to pending criminal investigations and cases and contain exculpatory evidence. Page 42 of 92 241. On Jan. 20, 2018, a rental note entered by the Bakersfield location indicates “SPOKE TO CUSTOMER” and that the customer is “paying out of pocket.” rental return date is listed on the Hertz rental notes. 242. In fact, on January 20, 2018, Mr. Junious returned to the location and upgraded the rental to a 2017 Dodge Ram. Mr. Junious agreed to personally pay for the rental at this point using the valid credit card ending in 2404. Mr. Junious expressly told Hertz, when asked how long he needed the car, that it was for an indefinite period until he was able to get a new car. There was no issue with Hertz who said that as long as he provided a valid credit card that could be charged there were no problems. 243. On or around January 24, 2018, Mr. Junious followed up with Hertz by phone because he wanted to confirm that the activity on his credit card from Hertz was okay. Essentially, charges from Hertz were appearing on his account and then disappearing after around 1 day. 244. Mr. Junious was told by Hertz that Hertz routinely places “holds” on customers’ credit cards—which temporarily show up and then disappear on the customer’s online financials— to verify that the card is valid and that the rental is authorized and continuing. He was told that the total rental bill would be formally charged later and only then show up on his statement. 245. Mr. Junious also spoke with Hertz on January 30, 2018, to again clarify and confirm his rental was okay: [intentionally left blank] Page 43 of 92 246. Hertz’s holds appeared on Junious’s credit card from January 20, 2018 onward—as discussed with Hertz’s employees—and he was continuously billed for the rental as discussed and agreed with Hertz. He knew of no issues. He was charged $1,375.94 on March 14, 2018. 247. Unbeknownst to him, Hertz and its employees went to the police and filed a police report on March 15, 2018, falsely claiming that Junious had stolen the car, never paid a dime for the rental, and that they had not heard from the renter. They said the return date was January 29, 2018. All of this was absolutely false. 248. Not only had both State Farm and Junious been billed, at all points in time authorization holds were being placed by Hertz on Plaintiff’s credit card for the rental, objectively indicating to the customer and Hertz that the rental was authorized and continuing. Page 44 of 92 249. Furthermore, Mr. Junious never knew about and/or was told about a return date of January 29, 2018. Hertz’s own rental notes do not even show a return date of January 29, 2018. 250. Indeed, when Junious spoke with Hertz one day after January 29, 2018—on the January 30, 2018 call—he was not told the rental was overdue but instead that everything was fine. 251. He was also never told about any such return date when he spoke with Hertz both in person and on the phone on January 20 and January 24 respectively. 252. To his surprise Junious was arrested and jailed on April 1, 2018, for embezzlement This is defined by California Penal Code § 503 as requiring a showing that defendant “fraudulently appropriated the property” and “intended to deprive the owner of its use.” 253. By definition, embezzlement and fraud do not occur when the rental property alleged to have been embezzled was being paid for pursuant to an agreement with the rental company. That Hertz omitted this payment from the theft package was material and inexcusable. There was no probable cause to report Junious or continue with his prosecution. 254. On May 7, 2018, after Junious had languished in prison for a month, there was a preliminary hearing. Whether Junious had paid for the rental was a prominent issue. 255. Unbelievably, a Hertz manager named James Nichols testified under oath, plainly reading from the false theft package given to the police, that Junious had never paid any money for the rental. 256. Not only did Hertz fail to verify and investigate the theft package before submitting it to the police, but no one at Hertz bothered to verify if this information was accurate before testifying in court. 257. As a result, Junious remained imprisoned until June 1, 2018, and was only released for medical reasons. Page 45 of 92 258. Hertz did not withdraw the prosecution, and the prosecutors continued to demand that Junious take a plea deal, threatening him with a significant jail time. 259. On October 8, 2018, Hertz unwittingly submitted a restitution request to the prosecution. This restitution request actually admitted that Junious had paid $1,345 for the rental, completely contradicting the prior testimony and theft report by Hertz. 260. The prosecution nevertheless attempted to convince Junious to take a plea deal, but threatening a trial. Junious refuse. On the day of trial, November 1, 2018, the prosecutors instead dropped the case in the interests of justice, finally acknowledging that they could not possibly win a case against Junious. Plaintiff Hanna Ayoub 261. Hannah Ayoub is a citizen of Pennsylvania. Hannah was accused in Wilmington, Delaware, arrested and prosecuted in New Jersey, and prosecuted in New Castle, Delaware. 262. Mr. Ayoub’s case is described above and incorporated here by reference. 263. In short, he rented a car with Hertz at the Wilmington, DE Amtrak station at the beginning of April 2019 and his phone records show that he extended every week with the Wilmington branch, including on April 15, 2019 (to April 22, 2019). 264. However, on April 16, 2019, he received a phone call from Hertz Wilmington telling him the rental was due April 15, 2019, and asking if he wanted to extended. He spent a long, exasperating time on the phone with the branch explaining that he had extended the day before. 265. The branch was adamant that there was no record that he had extended or contacted Hertz on April 15, 2019. His rental extension and contact had been erased, and his rental due date backdated. Fed up with the location, Ayoub began extending on the corporate 1800 number without further issues (or so he though). Page 46 of 92 266. On May 7-8, he was contacted by an aggressive investigator who worked for Hertz who that claimed Ayoub had to return the car. However, after some confusion where Ayoub initially said he would return the car, Ayoub spoke with Wilmington and the investigator and confirmed that he was authorized to have the car. The investigator then left him alone. 267. Ayoub continued extending the rental, week over week, through early June 2019. On May 24, 2019, he paid $2,309.44. He called Hertz several times and confirmed the rental was okay. 268. Then, to his shock, he was arrested on June 2, 2019. Hertz had claimed in a blatantly false theft package that the rental was due back on April 15, that Ayoub had promised to return the car but failed to do so, that Ayoub had not paid for therental, and that Ayoub had refused to contact the company. 269. Apparently, Hertz’s vehicle control department did not record his voluminous contacts with the company, his payment, or that Hertz was extending his rentals. It is no coincidence that Hertz claimed the vehicle was due April 15, 2019, the original date Hertz’s computer systems erased Ayoub’s extension. 270. Hertz theft package was egregiously false, and there was no probable cause to report him or continue to prosecute him. 271. As a result he was prosecuted in New Jersey and in New Castle, Delaware for several months. 272. The New Jersey prosecutor dismissed the case upon reading the theft report, finding that it was a civil not criminal matter. 273. The New Castle prosecutor dismissed the case after being shown Ayoub’s extensive contact with the company and his payment. Page 47 of 92 Plaintiff Laketa Collins 274. Laketa Collins is a citizen of Florida and was prosecuted in Pinellas County, Florida. 275. Plaintiff Laketa Collins is a 39-year old mother of 2 adolescent boys. Following a car accident, Ms. Collins’ insurance company, Geico, rented her a car from the Hertz Clearwater location. 276. When Collins picked up the car on July 7, 2018, she provided Hertz with a valid credit card from Fifth Third Bank as a security deposit, although Geico was paying for the rental. 277. The rental started on July 7, 2018, and was initially supposed to last until July 11, 2018. However, Geico called Collins after five days and let her know they were extending the rental with Hertz because they had not yet been able to secure her a replacement car. 278. Geico extended the rental a total of two times, until July 18, 2018. 279. As of July 18, 2018, Collins spoke with Hertz on the corporate 1-800-4174 rental extension number and extended the rental. She took over the payments for the rental on the card she had already provided to Hertz at the beginning of the rental. 280. Collins extended the rental several more times on the 1-800 number, in July and August 2018. There were no issues. 281. In August 2018, the rental car key was misplaced. Collins, at this time was out of state. Ms. Collins spoke with Hertz Roadside at the end of August about towing the car. She spoke with an employee, a black woman, who gave her a claim number and told Collins that Hertz was on the way to pick up the car. The employee said nothing about the car being stolen. The car was in fact retrieved. 282. On or around August 29, 2019, her card was charged $2,290.60 for the car rental. Page 48 of 92 283. Over half a year later, on Valentine’s Day 2019, after she had tucked her kids to bed, Collins briefly stepped out to run an errand around the corner from her house. 284. While she was driving, five or six officers pulled her over. Their guns were drawn. The police then told her that their automatic plate reader said that she had a warrant out for her arrest. This was, to put it mildly, a complete shock. She had no idea what the officers were talking about. They then told her that it was for car theft. 285. Collins insisted that the car she was driving was her car, registered in her name. 286. After going back and forth with one of the officers, who repeatedly accused her of theft, he finally told her that it related to a rental car back in August 2018. She was still confused because her Hertz rental was an insurance rental through Geico, and the rental was paid for and returned. 287. She was then taken to the police station and fingerprinted, booked, and jailed overnight. She did not post bail ($500 of $5,000) until later that morning—money she frankly needed to take care of her family—and did not make it back time before her kids woke up and went to school. They were frightened and confused where their mom was. 288. The entire experience was bizarre, jarring, and humiliating for her and her entire 289. The more Collins learned about what happened, the more bizarre it became. 290. According to police documents, a Hertz employee named Joseph Gatewood family. reported the car stolen on August 30, 2019. Gatewood and Hertz falsely claimed that after she rented the car on July 7, 2018, they never heard from her again. Hertz falsely claimed that the rental was due back July 11, 2018, had never been extended, and that Collins had simply absconded. Hertz further stated that Collins owed them over $2,000. Page 49 of 92 291. Not only was this not true, but this is more evidence that Hertz is erasing extensions. Geico has confirmed that it actually extended the rental to July 18, 2018, then Collins took over extending the rental. 292. Not only did Hertz not record Collins’ extensions into August 2018, but it never recorded any of Geico’s extensions either. 293. Hertz never withdrew the charges against her. Despite Hertz being sent subpoeans for the case, no one appeared for the case. 294. On July 19, 2019, the prosecutors finally nolle prossed the charges stating that “further investigation of this case by the State Attorney’s Office has revealed that further prosecution is not warranted.” Plaintiff Michelle Johnson 295. Michelle Johnson is a citizen of California who resides in Illinois. Johnson was prosecuted in Hamilton County, Indiana. 296. Ms. Johnson was visiting Indiana from California to take care of her invalid mother for from 2018 into 2019. 297. She routinely reserved cars on Hotwire with Thrifty Car Rentals (Thrifty is run by Hertz and Hertz Vehicle Control and Corporate Security handle theft reports for Thrifty). 298. Johnson paid Hertz thousands of dollars from 2018 to 2019 over many rentals. Because there were many billing issues, Johnson was routinely on the phone and was a diligent renter. 299. In December 2018 she rented a car from the Thrifty in Indianapolis, through Hotwire. She spoke with Hertz/Thrifty throughout the rental, but was suddenly hit on 2/13 with a charge for $3,578.20. Page 50 of 92 300. This was a huge overcharge. She called Thrifty to complain, and was told her complaint was being “escalated.” Then, over the next several months, she was told by Thrifty personnel that she should not return the car because it would make it hard to “close out” her rental and impossible to give her a credit. 301. She was utterly confused, because this was unlike all her prior rentals: however, she followed their directions over the next several months. 302. In or around May she had an accident with the car and reported it to her insurance. 303. To her dismay, she was arrested in July 2019 without warning. She was taken to jail, and then prosecuted until January 2020 when the case was dismissed. 304. Her life was destroyed because of this, and because charges were pending she could not visit her home state of California. She is now facing foreclosure and the loss of her home. Plaintiff Brian Steinberg 305. Brian Steinberg is a citizen of New Jersey but was arrested and detained in Las Vegas, Nevada. 306. Steinberg, a dentist, decided to take a two-week vacation out to Las Vegas. Upon landing he rented a Hertz car on March 2, 2018. He stopped at the Flamingo for 30 minutes, but when he came back police immediately detained and arrested him. 307. He was then interrogated and searched for two terrifying hours by police who claimed he stole the car. 308. Only at the end of this ordeal did the police let him go. Hertz had “lost” this car from inventory. Instead of conducting a proper search of Hertz’s lots and realizing that it was still at a Hertz location, Hertz reported the car as stolen without any adequate investigation. 309. Then, despite having told the police the car was stolen, Hertz did not update its systems. The Henderson location then rented Steinberg the “stolen” car. Page 51 of 92 310. This is absurd and outrageous. As a result, Steinberg was detained for two hours, terrified, and his vacation was ruined. Plaintiff Antwone Person 311. Antwone Person is a citizen of Illinois was prosecuted in Cook County, Illinois. 312. Person rented a Hertz vehicle starting on April 29, 2019. Person validly extended the rental. 313. On June 14, 2019, Person was arrested and hauled off to jail. He was completely baffled because he thought he had a valid rental. He was released after several hours and not told what was happening. Right now he is in legal limbo. 314. It turned out that Hertz had falsely told the police that Person had rented a car on April 15 which was due back on April 29, 2019, but had not been returned. This was untrue. 315. As a result of this false report, Person was reported to the police arrested, jailed, and prosecuted. Plaintiffs Michael and Amanda Koss 316. Michael and Amanda Koss are citizens of Oklahoma and were arrested, prosecuted, and imprisoned in Oklahoma City jail. 317. They had lived in Washington, but were moving to Oklahoma to be near Michael’s dying dad. Michael had done several tours in Iraq as a Marine, and then several more overseas with General Dynamics. As a result, he had rented with Hertz probably around 50 times. He had so many points compiled he sometimes could rent vehicles for free. 318. Michael and Amanda went to the Hertz location at the Seattle-Tacoma Airport in early 2013, and rented a car. Because the power was out they filled out a paper rental contract. They informed the Hertz employee they wished to rent the vehicle for two months, maybe longer, so the Hertz employee made an open-ended, handwritten contract and went on their way. Page 52 of 92 319. Michael conducted his rental the same way he had fifty times before. 320. One night a couple months later, Michael and Amanda pulled up to his father’s house to cook him dinner. However, as they drove in to the neighborhood approximately 8 police cars were following them. 321. When they parked, and officer walked up to them and asked if this was their car. They responded that they were renting it and were immediately placed in handcuffs. This occurred in front of the entire neighbor, and Michael’s parents and grandmother. 322. Then, because he legally had a firearm, he was accused of possessing a firearm during the commission of a felony. This was a surreal, nightmarish experience. 323. They were then jailed for approximately 12 hours, a humiliating and terrifying experience. Upon being released, they showed up to multiple hearing dates but their names were never called. To this day, the charges remain pending against them and have never been withdraw. 324. After this experience, Michael walked into the Hertz corporate offices in Oklahoma City demanding answers, but was ignored by Hertz and asked to leave. 325. As best as can be ascertained, Hertz never recorded the Kosses’ rental correctly, did not investigate or call the Kosses, and reported the vehicle as missing and stolen—despite it having been rented to a customer. 326. The ramifications of Defendants’ conduct have been severe. Michael’s PTSD from multiple combat tours was triggered and he experienced deep depression. Family members pushed Amanda to divorce Michael, unable to believe that a large corporation like Hertz could do such a thing. Michael’s grandmother and father both died thinking it was possible that he stole a car. 327. Both Michael and Amanda are confronted with what life could have been 328. Monetarily, the damages have been severe, because both have pending felonies against them. Michael’s earning capacity was $250,000 prior to this false report and he had a Page 53 of 92 security clearance. Now, he has to work an IT job, essentially taking a $150,000 a year pay cut. Amanda is a trained physical therapist, but due to the pending felony, instead bartends. They each had to pay $2,400 in bail, and then another $8,000 for a criminal lawyer. The property confiscated during the arrest was also worth around $5,000. 329. Michael Koss is an American hero, but was treated with absolute disrespect by Hertz and the other defendants. Plaintiff Cheryl Young 330. Cheryl Young is a citizen of California and was prosecuted in San Joaquin County, California. 331. Young rented a car from the Manteca, CA location in May 2018 and gave them her Mastercard. For the first three weeks she extended with the location, and even visited the location to explore exchanging her vehicle. 332. However, after three weeks, she then started extending with the 1800 corporate extension number and kept the car. 333. As the rental continued into July she spoke with Hertz, and if there was an issue she called Hertz to extend and confirm she could use the rental. 334. Then in early August 2018, she received an email from a Terry Wells, claiming that Hertz was taking legal action to recover the car. Wells apparently worked for a company hired by Hertz named Collateral Consultants. 335. This was confusing, as Young had been extending the rental. Nevertheless, on August 9, 2018, Young told Wells she was retrurning the car and wrote: “I apologize for the inconvenience. I have no intention of stealing the vehicle.” On August 10, 2018, she let Wells know the car had been returned by email, as well as called the Manteca location. In a voice call, Page 54 of 92 Wells told Young that once the car was verified returned any action against Young would be stopped and taken care of. 336. Following the return, Hertz billed Young $3,932.47. This was a significant overbilling. Young spoke with Hertz repeatedly and the bill was reduced to $1,899.47. Young’s receipt says “Amount Due: 0.00 USD.” At no point was she told by billing that she was being prosecuted. 337. It was only in April 2019 that Young learned when applying for a job that Hertz had actually filed a police report on August 9, 2019, and then had formal charges filed against her on September 13, 2018. Why Hertz would initiate and continue a prosecution against a customer who had returned the car and paid? 338. Because there was a pending felony case against her, Young was turned down for multiple jobs. She is a nurse/healthcare administrator and background checks are required. 339. Unable to get work, she contacted Hertz to confirm that the vehicle was returned and ask why she was being prosecuted. A Hertz employee confirmed the return, but was singularly unhelpful about having the clearly unwarranted prosecution dropped. She was told to Google “OKC, OK”: [intentionally left blank] Page 55 of 92 340. She later emailed Hertz’ corporate security manager Clifford Gray in December 2019 asking him to drop the charges and pull the warrant. Gray falsely told her that Hertz could not stop pursuing the case against her. 341. Young was forced to go to Court until the case was dropped shortly before Christmas 2019. Plaintiff Stephnie and James Keene 342. Stephanie and James Keene are citizens of Florida and James was arrested in Pinellas County, Florida. 343. James and Stephanie were rented a Hertz car on a Tuesday night in August 2019 by their insurance company from the Clearwater Hertz. 344. On Wednesday morning, James took the car to wor. On the way back from work James was dropping an employee off at her apartment while Facetiming with his wife Stephanie. Page 56 of 92 345. Yet, as he pulled into the employee’s parking lot, multiple police officers pulled him over with guns out. His wife was panicking, seeing this develop on Facetime. 346. She quickly drove to the apartment complex and watched as her husband was detained, arrested, and accused of stealing a car for 1.5 hours as the police spoke with Hertz. 347. James desperately explained to them that he just rented the car a day earlier and that there was no way he could have stolen it. He was finally let go. 348. It was later learned that the license plate on the car rented to the Keenes was reported stolen by Hertz out of Jacksonville, FL one year prior on a different car. During that time span Hertz absurdly failed to realize that the plate was reported stolen, transferred the plate to a new car, completed all the paperwork, and then rented out the stolen plate on a new car to the Keenes. 349. The experience was entirely humiliating and terrifying for both Keenes. The Keenses tried to call a district manager to complain about their treatment, but could not get anyone. Then, randomly, a customer service representative called them to ask how they enjoyed their rental. Only at this point were they able to speak with a manager at the Clearwater location. 350. The manager told them that this happens because the corporate and local computer systems cannot talk to each other and are separate. Plaintiff Barbara Fernandez 351. Barbara Fernandez is a citizen of Florida who resides in Miami-Dade. She was prosecuted in Alachua County, Florida. 352. On February 7 2017, Plaintiff Barbara Fernandez rented a Toyota Yaris from the Hertz location in Gainesville, FL. She was a Hertz Gold Member. 353. The rental ticket shows that the rental was initially for one week (due 2/14/2017). However, Ms. Fernandez had told the two Hertz employees renting her the car (one black and one Page 57 of 92 white man who were both in their 40s) that it would be a long-term rental since she and her husband were in the middle of moving houses. They told her to call each week to extend the rental—which she did every week. 354. When first renting the vehicle she provided a valid credit card from Regions Bank, and also gave Hertz her temporary address (a La Quinta Inn in Miami) since she was in the middle of moving. She specifically informed the Hertz employees that the address on her driver’s license was out of date. 355. For the first three weeks, she extended the rental with the Gainesville branch. However, after three weeks she started to use the corporate rental extension number listed by Hertz on the rental material due to cheaper rates. 356. At no point did any representative tell her there was a problem with the rental. On May 1, 2017, she paid Hertz $2,304.73 on her Regions Bank card. Ms. Fernandez continued to call and confirm rental extensions with Hertz corporate after this payment, and there was no issue. She arranged with Hertz corporate to return the rental on June 7, 2017 in Miami. 357. On June 6, 2017, her husband Jose saw someone trying to tow away the rental car from the hotel parking lot. When confronted, it was a repo man who said that he had to take the car. Ms. Fernandez demanded that the police be called. 358. When the police arrived, to her surprise they told her Hertz had reported the car stolen as of May 3, 2017, in Gainesville. Hertz was saying that the car was due back on March 27, 2017. This was entirely untrue; Fernandez had been diligently extending the rental and did not suddenly stop in March 2017. She was confused because she had been constantly talking to Hertz who never said anything about this. Page 58 of 92 359. Ms. Fernandez was scared and frightened, but pulled out her phone and showed the police the $2,304.73 payment on May 1, 2017, and additional pending charges on her bank account for rental extensions after May 1, 2017. 360. This is documented in the police incident report: “Ms. Fernandez showed me via phone bank statements that on 05/01/2017 she had paid $2,304.73 to Hertz rental car company and has not missed a payment since she had rented the listed vehicle.” 361. Incredibly, Hertz’s May 3, 2017 theft report alleged that she had never paid for the rental and owed $2,304.73—the exact amount she had already paid several days earlier. She was not arrested at that time, and was not told there was any further problem. 362. Unfortunately, two years later in 2019 her daughter was driving a car in Ms. Fernandez’s name. The police stopped the car and informed her daughter that her mother had a warrant out for her arrest. 363. Shocked, Ms. Fernandez immediately turned herself in in August 2019 trusting that the mistake would be quickly corrected. Instead, she spent the night in a jail cell, and realized to her horror that she was in the middle of an Orwellian nightmare. 364. She was then prosecuted for half a year, until just a few days before trial the prosecutor dropped all the charges on or around January 17, 2020. Plaintiffs Thomas and Michael Channell 365. Michael and Thomas John Channell are citizens of Florida and were prosecuted in Palm Beach County, Florida. Thomas is Michael’s father. 366. Michael and Thomas Channell rented a Chevy Malibu from Hertz in November 2017. They specifically had a multi-month contract approved by Hertz, where the rental continues month over month. Instead of being charged at the end of the rental, in multi-month rentals the Page 59 of 92 renter is charged at end of every month period. The Channells were charged around the 22nd or 23rd of each month. 367. In January 2018, the Channells exchanged the Malibu for a Toyota Camry, but their multi-month rental continued unaffected, and was supposed to continue until June. 368. However, as Thomas Channel was driving on May 12, 2018, he was pulled over by the police. To his shock, they accused him of car theft, and held him at gunpoint on the pavement as he desperately tried to explain that it was just a rental car. 369. As he was panicking on the highway he began to have a massive heart attack. He was rushed to the emergency room and had to have emergency heart surgery. 370. As he was undergoing surgery, Hertz called his son Michael, apologized, and told him where the impound lot was to pick up the car. 371. It turned out that when the Channels had exchanged the cars in January, Hertz had treated the exchange addendum as a whole new contract with a due date of February 22, 2018. 372. Hertz Vehicle Control had failed to realize that there was a continuing multi-month contract, which even the most basic investigation should have caught. 373. As a result, Hertz reported Michael Channell for car theft, resulting in a police report against Michael and the arrest of his father. Not only did Thomas Channell rent the car with Michael, and was supposed to be an authorized driver, but Hertz also owed a duty to Thomas because as a family member of Michael it was entirely foreseeable that Thomas would be in the car. 374. As a direct and proximate result of Hertz’s conduct, Thomas Channell suffered a heart attack, they were both falsely accused of car theft, and the Channells have been subjected to extraordinary mental and emotional pain and suffering. Hertz’s conduct also increased the risk of harm to Thomas Channell and was a substantial factor in bringing about this injury. Page 60 of 92 Plaintiff Jessica Gurumendi 375. Jessica Gurumendi is a citizen of Florida, who was harmed in Chicago, Illinois. 376. Jessica rented a Chevy Impala from Dollar, which is owned by Hertz, at the Orlando, FL airport. She rented the car because she was driving to Illinois. The rental started on December 14, 2019, and was originally supposed to expire on January 4, 2020. On January 3, she extended the rental until February 5, 2020. 377. Yet, on January 31, 2020, her car turned off and a tow company appeared out of nowhere claiming it was stolen in Illinois. She called customer service and was told that it had been remotely deactivated. She was then transferred to roadside assistance, and spoke with someone named Cameron. 378. She explained that she had extended the rental and that this should not be happening. Cameron acknowledged that there was an extension in the system for a contract with a number of 187895525 for a car with Michigan plate DZD2917. 379. Later, Jessica learned from the O’Hare airport location that the rental had been botched from the beginning. Defendants thought she had rented a blue Hyundai 2019, not an Impala. The extensions on her contract were therefore not being processed correctly. 380. Instead, Defendants had reported the Impala as stolen without any real investigation and without knowing if it was even stolen. 381. After spending hours resolving this nightmare, she was issued an accurate and updated contract extending the rental out to February 14, 2020. 382. As a result of Defendants’ towing the car before Jessica could fully clean out her belongings, and not letting her access the vehicle, an approximately $10,000 ring went missing. 383. The entire situation was extremely stressful, as was the loss of the engagement ring. Page 61 of 92 Defendants 384. All Hertz companies, directors, and officers are referred to jointly as “Hertz” throughout this complaint, unless otherwise specified. 385. Defendant Stone has been President and CEO of Hertz since May 16, 2020. Stone previously held the position of Chief Retail Operations Officer since March 6, 2018. 386. Defendant Marinello was President and Chief Executive Officer of Hertz from January 3, 2017 until May 16, 2020. She remains a consultant and a board director for Hertz. 387. Defendant Tague was President and CEO of Hertz from November 21, 2014 to January 2, 2017. He was aware of the conduct and deficient policies and continued their implementation. 388. Defendant Frissora was CEO and Executive Chairman of Hertz from January 1, 2007 until September 7, 2014. Under Frissora, Hertz promulgated and used highly defective theft reporting polices and procedures which led to customers and vehicles being wrongfully reported to the police. 389. Defendant Galainena is an Executive Vice President and Secretary and has also served as General Counsel for Hertz since April 1, 2019. 390. Defendant Frecker is former General Counsel and Executive Vice President of Hertz. He held these positions until he resigned on March 19, 2019. Frecker previously held other legal positions in Hertz dating back to 2008. 391. Defendant Esper has served as Senior Vice President and Chief Accounting Officer of Hertz since November 2018. He previously served as Vice President and Controller of the Company beginning March 2018. 392. Defendant Hunziker has served as Senior Vice President of Investor Relations, Corporate Communications and Corporate Responsibility since January 2017 and Senior Vice President of Investor Relations since December 2009 for Hertz. Page 62 of 92 393. Defendant Kennedy served as a Senior Executive Vice President and Chief Financial Officer of Hertz from December 2013 to August of 2018. 394. Defendant Allen has served as Executive Vice President and Chief Marketing Officer of Hertz since October 2017. 395. Defendant Foland served as Senior Executive Vice President and Chief Revenue Officer from January 2015 until February 28, 2017. 396. Defendant Kuppuswamy has served as Executive Vice President and Chief Human Resources Officer of the Company since September 2017. 397. Defendant Best served as Executive Vice President and Chief Information Officer of Hertz from January 2015 to April 2018. Best oversaw Hertz’s global information technology functions. 398. Defendant Marren served as Executive Vice President of North American Rental Car Operations from August 2015 until May 2017. 399. Defendant Deschamps has served as the Executive Vice President of Pricing, Revenue Management and Fleet Operations since November 2017 and the Senior Vice President of Pricing and Revenue Management since January 2016. 400. Defendant Jackson has served as Executive Vice President and Chief Financial Officer of Hertz since September 2018. 401. Defendant Zem served as Executive Vice President and Chief Human Resources Officer from June 2015 until September 2017. 402. Defendant Kramer served as Senior Vice President and Chief Accounting Officer of Hertz from May 2014 until November 2018. 403. Defendant Perry has served as Executive Vice President and Chief Information Officer of Hertz since August 2018. Page 63 of 92 404. Defendant Jauchius served as Executive Vice President and Chief Marketing Officer of Hertze from October 2015 until March 2017. 405. Defendant Callahan has served as the President of Donlen Corporation since January 2013. Mr. Callahan succeeds Gary Rappeport, the former CEO of Donlen, who retired on December 31, 2012, as the principal executive officer of Donlen. Mr. Callahan served, in addition to President of Donlen, as Chief Operating Officer of Donlen since September 2008. Prior to being named Chief Operating Officer, Mr. Callahan served as Executive Vice President and Senior Vice President of various aspects of operations at Donlen since 2006. 406. Defendant Massengill has served as Senior Vice President and Treasurer of Hertz Holdings and Hertz since July 2008. 407. Defendant Mukherjee has served as a director of Hertz Global Holdings and Hertz since May 2018. 408. Defendant Sheehan has served as a director of Hertz Global Holdings and Hertz since August 2018. 409. Defendant Keizer has been a director of the Company since October 15, 2015. Keizer has been the Independent Non-Executive Chair of the Company since January 2017. Keizer is also a member of the audit committee of the Board (the “Audit Committee”). 410. Defendant Barnes has been a director of the Company since May 18, 2016. Barnes is also a member of the Audit Committee and the compensation committee of the Board (the “Compensation Committee”). 411. Defendant Everson has been a director of the Company since May 15, 2013. Thus, Defendant Everson was a member of the Board during much of the misconduct complained of herein. Page 64 of 92 412. Defendant Intrieri has been a director of the Company since September 15, 2014. Defendant Intrieri was appointed to the Board pursuant to a Nomination and Standstill Agreement (the “Nomination and Standstill Agreement”) the Company entered into with Carl C. Icahn. 413. Defendant Ninivaggi has been a director of the Company since September 15, 2014. Defendant Ninivaggi was appointed to the Board pursuant to the Nomination and Standstill Agreement. 414. Defendant Cho has been a director of the Company since May 31, 2017. Defendant Cho was appointed to the Board pursuant to the Nomination and Standstill Agreement. 415. Defendant Hertz Global Holdings, Inc., is a Delaware corporation with principal executive offices located at 8501 Williams Road, Estero, Florida 33928. Its registered agent for service of process within the State of Delaware is The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801. Hertz is engaged in the automobile and equipment rental businesses worldwide. The Company’s stock is traded on the New York Stock Exchange under the ticker symbol “HTZ.” 416. Defendant The Hertz Corporation is a Delaware corporation with principal executive offices located at 8501 Williams Road, Estero, Florida 33928. Its registered agent for service of process within the State of Delaware is The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801. The Hertz Corporation runs the car rental operations, vehicle control, corporate security, and all other functions pertinent to this lawsuit, including for Hertz subsidiaries and Dollar and Thrifty. Specifically, Hertz vehicle control and corporate security handle theft reporting for Dollar and Thrifty. 417. Defendant Rental Car Intermediate Holdings, LLC is a Delaware corporation with principal executive offices located at 8501 Williams Road, Estero, Florida 33928. Its registered Page 65 of 92 agent for service of process within the State of Delaware is The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801. 418. Defendant Hertz Investors, Inc. is a Delaware corporation with principal executive offices located at 8501 Williams Road, Estero, Florida 33928. Its registered agent for service of process within the State of Delaware is The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801. 419. Defendant Hertz Vehicles LLC is a Delaware corporation with principal executive offices located at 8501 Williams Road, Estero, Florida 33928. Its registered agent for service of process within the State of Delaware is The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801. Hertz Vehicles LLC is the company that is listed as actually owning the vehicles rented out by Hertz. 420. Defendant Hertz Vehicle Financing LLC is a Delaware corporation with principal executive offices located at 8501 Williams Road, Estero, Florida 33928. Its registered agent for service of process within the State of Delaware is The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801. 421. Defendant Hertz Vehicle Financing II LP is a Delaware corporation with principal executive offices located at 8501 Williams Road, Estero, Florida 33928. Its registered agent for service of process within the State of Delaware is The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801. 422. Defendant Hertz Local Edition Corp. is a Delaware corporation with principal executive offices located at 8501 Williams Road, Estero, Florida 33928. Its registered agent for service of process within the State of Delaware is The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801. Page 66 of 92 423. Dollar Rent A Car, Inc. is an Oklahoma Corporation with a principal office located in Hertz’s Florida Offices. 424. Thrifty Rent-A-Car System LLC is an Oklahoma corporation with principal executive offices located at Hertz’s Florida Offices. 425. Defendant Icahn Associates Holding LLC is a Delaware corporation with principal executive offices located at 767 Fifth Avenue, Suite 4700, New York, NY 10153. Ichan Associates owns approximately 40% of Hertz stock, or approximately 55 million shares. IA is a subsidiary of Icahn Enterprises. 426. Defendant Icahn Enterprises LP is a Delaware corporation with principal executive offices located at 767 Fifth Avenue, Suite 4700, New York, NY 10153. 427. Icahn Enterprises Holdings LP is a Delaware corporation with principal executive offices located at 767 Fifth Avenue, Suite 4700, New York, NY 10153. 428. Icahn Capital LP is a Delaware corporation with principal executive offices located at 767 Fifth Avenue, Suite 4700, New York, NY 10153. 429. Icahn Enterprises GP, Inc. is a Delaware corporation with principal executive offices located at 767 Fifth Avenue, Suite 4700, New York, NY 10153. 430. The five Icahn defendants actively manage Hertz, actively appoint board members, actively participate in appointing and removing officers, and participate in making policy at Hertz. The Icahn Defendants, indeed all Defendants, have been aware of the serious problems that affect Hertz’s theft reporting since at least September 2017 but have done nothing to fix the issues despite having the ability and duty to do so. ***** Page 67 of 92 Jurisdiction, Venue, and Joinder 431. Personal Jurisdiction over the corporate defendants in the State of Delaware is proper because the corporate defendants are incorporated here and are citizens of this state. The corporate defendants also carry on business in this forum which has resulted in at least one plaintiff being falsely reported to the police in New Castle County. Jurisdiction over the individual defendants is appropriate under § 3114 because they are directors and officers of Hertz, and have consented to jurisdiction in this state. 432. Venue is appropriate in this forum because this matter involves significant issues of Delaware law due to the fact that the Defendants have availed themselves of incorporation here, Defendants transact business in this state, and at least some of Defendants’ conduct and harm occurred in this forum. 433. Joinder of the plaintiffs is appropriate in this case because the plaintiffs are asserting a “right to relief jointly, severally, or in the alternative in respect of or arising out of the same transaction, occurrence, or series of transactions or occurrences and if any question of law or fact common to all these persons will arise in the action.” Joinder of the defendants is appropriate in this case because the plaintiffs have asserted against the defendants “jointly, severally, or in the alternative, any right to relief in respect of or arising out of the same transaction, occurrence, or series of transactions or occurrences and if any question of law or fact common to all defendants will arise in the action.” 434. Specifically, for purposes of joinder, the operative occurrence or series of occurrences from which Plaintiffs’ right to relief arise were the defendants’ drafting, institution, maintaining, and failure to revise Hertz’s extraordinarily deficient theft reporting policies, all of which imposes liability on the corporate and individual defendants for inter alia negligent supervision and management. The most significant date is on November 14, 2017, when all Page 68 of 92 Defendants were directly and unambiguously warned after losing a malicious prosecution trial in Philadelphia in 2017, that Hertz’s theft reporting policies and procedures—including W7-02— were extraordinarily deficient and causing grievous harm to customers. 435. All defendants at all points failed to take steps to revise the policies and procedures, and in fact affirmatively approved of the continued use of these policies and procedures. The negligent, grossly negligent, reckless, intentional and/or malicious drafting of these polices and procedures, failure to revise these policies and procedures, and the continuing use of these policies and procedures directly and proximately caused significant harm to all plaintiffs. 436. All defendants are also liable for the other alleged torts, including inter alia malicious prosecution, abuse of process, intentional/negligent infliction of emotional distress, false arrest/imprisonment, and unfair trade practices caused by these tortious business practices. 437. The defendants’ concerted, coordinated, and deliberate course of conduct not only constitutes an occurrence of series of occurrence giving rise to Plaintiffs’ claims, but it also gives rise to common issues of fact and law as to all of Plaintiffs’ claims. ***** Page 69 of 92 COUNT I – Malicious Prosecution All Plaintiffs (excluding Higgs, Sterlin, Michael Koss, Amanda Koss, Antwone Person)4 v. All Defendants 438. Plaintiff incorporates by reference and realleges the preceding paragraphs of this complaint. 439. The elements of malicious prosecution are: (1) the commencement of a criminal prosecution against the plaintiff; (2) causation (initiation, procurement, or continuation) of the action by the defendant; (3) termination of the prosecution in the plaintiff's favor; (4) the plaintiff's innocence; (5) the absence of probable cause for the proceedings; (6) malice in filing the charge; and (7) damage to the plaintiff. 440. All corporate defendants (jointly known as “Hertz”) are alleged to be vicariously liable for the conduct of their employees, including the individual Defendants. 441. The individual defendants are liable for this tort due to their participation in crafting the policies and procedures used to prosecute the plaintiffs, as well as their negligent, grossly negligent, reckless, knowing, intentional, and/or malicious supervision and management of Hertz’s theft reporting process. 442. All Defendants’ conduct, actions, and omissions were negligent, grossly negligent, reckless, malicious, and/or intentional. 443. At all points the conduct, actions, omissions of the individual Defendants and other Hertz employees was foreseeable to Hertz and done at Hertz’s direction and with Hertz’s blessing. 4 Because plaintiffs Higgs, Sterlin, Kosses, and Person’s criminal cases are still pending, they cannot yet bring a cause of action against Defendants for malicious prosecution. Page 70 of 92 444. Hertz failed to follow, and in fact deliberately disregarded, its own basic standard operating procedures and protocols designed to prevent false police reports, including Hertz national policy W7-02(a)(4) and (17) pertaining to investigating and verifying theft reports. 445. Hertz policy W7-02(D) is furthermore intentionally drafted and implemented to obtain police prosecutions by providing false payment information to the authorities. 446. Defendants are unjustifiably turning what they know are civil disputes into criminal matters. Defendants knew or should have known that all Plaintiffs had no criminal intent to steal a rental vehicle. 447. The initiation and continuation of the theft allegations by Defendants lacked probable cause because inter alia they: (1) falsely told the authorities the renter had not paid for the rental car, (2) conveyed a false history of the renters’ contacts and extension history with Hertz to the authorities, (3) failed to tell police that Hertz systems erase rental extensions without notice to customers or Hertz employees, (4) failed to convey to the police exculpatory information in Hertz’s rental records and contract rental notebook, (5) were never properly investigated or verified, and (6) because Hertz destroyed all rental information regarding the renters thereby preventing the authorities and the accused from obtaining exculpatory information. 448. In several cases described in this complaint (such as Julius Burnside and Cheryl Young), despite the renter voluntarily returning and paying for the car, Defendants inexpcaliby pursued criminal charges against the Plaintiffs for many months and years despite being asked to drop the prosecutions. 449. In all instances, when Defendants were asked to help the prosecutions, they falsely told the Plaintiffs that they were powerless to do so, thereby disregarding their duty not to continue prosecutions for which there is no probable cause and which Defendants did not even intend to pursue. Page 71 of 92 450. In some cases, in conjunction with the above failures, Defendants caused the arrest and prosecution by the customers without probable cause by (1) failing to realize that the vehicle had been rented out and then reporting the vehicle stolen as lost inventory despite having no idea if it was stolen (e.g., Stepanyan and Gurumendi), or (2) absurdly renting cars that were previously reported stolen to unwitting customers (e.g., Steinberg and the Keenes). 451. The facts applicable to each individual Plaintiff are incorporated by reference. 452. Defendants directly and proximately caused police and prosecutorial actions to be initiated and continued against the Plaintiffs without probable cause. Not only was materially false information provided to the police, but Defendants failed to supplement omitted and material information to the police and prosecutorial authorities, including information on payment and extensions. 453. Defendants failed to withdraw or otherwise inform the police and prosecutorial authorities that they wished to withdraw the charges against the Plaintiffs, and/or not continue with charges or prosecution, despite the absence of probable cause. 454. Defendants, in filing the police reports, did not intend to follow through on the prosecutions. 455. Defendants is not using the criminal justice system for the legitimate purpose of bringing alleged criminals to justice, but instead as a free taxpayer funded repo service to cut costs. Defendants have long known that it has routinely been falsely reporting innocent customers for theft, or lost cars as stolen, but has taken no steps to correct the problem. 456. As a direct and proximate result of Defendants’ conduct in initiating criminal complaints without probable cause and failing to withdraw the criminal complaints as set forth above, Plaintiffs have suffered severe damages, including but not limited to monetary damages, Page 72 of 92 loss of wages, physical injury, loss of freedom, severe emotional distress, mental suffering, mental anguish, sleeplessness, restlessness, anxiety, and depression. 457. As a direct and proximate result of Defendants using the criminal justice system for an objective other than bringing Plaintiffs to justice, Plaintiffs have suffered severe damages, including but not limited to monetary damages, loss of wages, physical injury, loss of freedom, severe emotional distress, mental suffering, mental anguish, sleeplessness, restlessness, anxiety, and depression. 458. Plaintiffs also request punitive damages due to the outrageous behavior of Defendants, their reckless disregard for Plaintiffs’ rights and life, and because Defendants have had years of notice that the company is wrongly reporting innocent customers for car theft but has done nothing to fix the problems but instead continue to make false and unverified police reports. ***** Page 73 of 92 COUNT II – Abuse of Process All Plaintiffs v. All Defendants 459. Plaintiff incorporates by reference and realleges the preceding paragraphs of this complaint. 460. A defendant is liable for abuse of process when prosecution is instituted by the defendant against the plaintiff or continued against the plaintiff for an ulterior motive or purpose not warranted by law, and which has no proper purpose. 461. Hertz is alleged to be vicariously liable for the conduct of its employees, including the individual Defendants. 462. The individual defendants are liable for this tort due to their participation in crafting the policies and procedures used to prosecute the plaintiffs, as well as their negligent, grossly negligent, reckless, knowing, intentional, and/or malicious supervision and management of Hertz’s theft reporting process. The individual defendants also owe a personal duty to the Plaintiffs. 463. All Defendants’ conduct, actions, and omissions were negligent, grossly negligent, reckless, malicious, and/or intentional. 464. At all points the conduct, actions, and omissions of the individual Defendants and other Hertz employees was foreseeable to Hertz and done at Hertz’s direction and with Hertz’s blessing. 465. The initiation and continuation of criminal proceedings against Plaintiffs by Defendants was done without probable cause. 466. Defendants acted for a purpose other than bringing plaintiffs to justice as they knew or should have known when they filed the criminal complaint against Plaintiffs that Defendants Page 74 of 92 never intended to pursue criminal cases against the Plaintiffs and were instead using the police as a taxpayer funded repo service. 467. Hertz knew that the plaintiffs (1) had permission to use the rentals, (2) had provided payment or a letter of credit, and (3) otherwise had no intent to steal the car. 468. At no point did Defendants correct the misrepresentations made in their police report and testimony, nor did they withdraw the prosecution despite there being no probable cause to continue with it. 469. Hertz is not using the criminal justice system for the legitimate purpose of bringing alleged criminals to justice, but instead as a free taxpayer funded repo service to cut costs. Hertz and the individual Defendants know that it has routinely been falsely reporting innocent customers for theft, but has taken no steps to correct the problem. 470. Defendants made this false complaint carelessly and/or negligently and/or recklessly and/or knowingly and/or intentionally and/or maliciously. Hertz failed to follow, and in fact deliberately disregarded, its own basic standard operating procedures and protocols designed to prevent false police reports, including Hertz national policy W7-02. 471. Defendants’ failure to withdraw the criminal complaint they initiated against Plaintiffs was careless and/or negligent and/or reckless and/or knowing and/or intentional and/or malicious. 472. As a direct and proximate result of Defendants’ conduct in initiating a criminal complaint without probable cause and failing to withdraw the criminal complaint as set forth above, Plaintiff has suffered severe damages, including but not limited to monetary damages, loss of wages, physical injury, loss of freedom, severe emotional distress, mental suffering, mental anguish, sleeplessness, restlessness, anxiety, and depression. Page 75 of 92 473. As a direct and proximate result of Defendants using the criminal justice system for an objective other than bringing Plaintiffs to justice, Plaintiffs have suffered severe damages, including but not limited to monetary damages, loss of wages, physical injury, loss of freedom, severe emotional distress, mental suffering, mental anguish, sleeplessness, restlessness, anxiety, and depression. 474. Defendants made these false complaints carelessly and/or negligently and/or recklessly and/or knowingly and/or intentionally and/or maliciously. Defendants failed to follow, and in fact deliberately disregarded, its own basic standard operating procedures and protocols designed to prevent false police reports, including Hertz national policy W7-02. 475. Defendants’ failure to withdraw the criminal complaints it initiated against Plaintiffs was careless and/or negligent and/or reckless and/or knowing and/or intentional and/or malicious. 476. As a direct and proximate result of Defendants’ conduct in initiating criminal complaints and continuing them without probable cause as set forth above, Plaintiffs have suffered severe damages, including but not limited to monetary damages, loss of wages, physical injury, loss of freedom, severe emotional distress, mental suffering, mental anguish, sleeplessness, restlessness, anxiety, and depression.. 477. As a direct and proximate result of Defendants using the criminal justice system for an objective other than bringing Plaintiffs to justice, Plaintiffs have suffered severe damages, including but not limited to monetary damages, loss of wages, physical injury, loss of freedom, severe emotional distress, mental suffering, mental anguish, sleeplessness, restlessness, anxiety, and depression. 478. Plaintiffs also request punitive damages due to the outrageous behavior of Defendants, their reckless disregard for Plaintiffs’ rights and life, and because Defendants have Page 76 of 92 had years of notice that the company is wrongly reporting innocent customers for car theft but has done nothing to fix the problems but instead continued to make false and unverified police reports. ***** Page 77 of 92 COUNT III – False Arrest/Imprisonment All Plaintiffs v. All Defendants 479. Plaintiff incorporates by reference and realleges the preceding paragraphs of this complaint. 480. A defendant is liable for abuse of process when prosecution is instituted by the defendant against the plaintiff or continued against the plaintiff for an ulterior motive or purpose not warranted by law, and which has no proper purpose. 481. Hertz is alleged to be vicariously liable for the conduct of its employees, including the individual Defendants. 482. The individual defendants are liable for this tort due to their participation in crafting the policies and procedures used to prosecute the plaintiffs, as well as their negligent, grossly negligent, reckless, knowing, intentional, and/or malicious supervision and management of Hertz’s theft reporting process. The individual defendants also owe a personal duty to the Plaintiffs. 483. All Defendants’ conduct, actions, and omissions were negligent, grossly negligent, reckless, malicious, and/or intentional. 484. At all points the conduct, actions, and omissions of the individual Defendants and other Hertz employees was foreseeable to Hertz and done at Hertz’s direction and with Hertz’s blessing. 485. The initiation and continuation of criminal proceedings against Plaintiffs by Defendants was done without probable cause. 486. As a direct and proximate result of the false, incomplete, and inaccurate information provided to police, Defendants caused the plaintiffs to be wrongfully detained, arrested, and/or imprisoned, or otherwise unfree to leave. Page 78 of 92 487. As a direct and proximate result of Defendants’ conduct, actions, and omissions, Defendants caused severe damages to Plaintiffs, including but not limited to monetary damages, loss of wages, physical injury, loss of freedom, severe emotional distress, mental suffering, mental anguish, sleeplessness, restlessness, anxiety, and depression 488. Plaintiffs also request punitive damages due to the outrageous behavior of Defendants, their reckless disregard for Plaintiffs’ rights and life, and because Defendants have had years of notice that the company is wrongly reporting innocent customers for car theft but has done nothing to fix the problems but instead continued to make false and unverified police reports. ***** Page 79 of 92 COUNT IV – Intentional/Negligent Infliction of Emotional Distress All Plaintiffs v. All Defendants 489. Plaintiff incorporates by reference and realleges the preceding paragraphs of this complaint. 490. The elements of intentional infliction of emotional distress are that Defendant (1) acted intentionally or recklessly, (2) acts and omissions were extreme and outrageous, (3) Plaintiff suffered serious emotional distress, and (4) Defendant’s conduct was a substantial factor in bringing about Plaintiff’s serious emotional distress. 491. The elements of negligent infliction are that (1) the Defendant was negligent, (2) the plaintiff suffered serious emotional distress, and (3) Defendant’s negligence was a substantial factor in causing the serious emotional distress. 492. Hertz is alleged to be vicariously liable for the conduct of its employees, including the individual Defendants. 493. The individual defendants are liable for this tort due to their participation in crafting the policies and procedures used to prosecute the plaintiffs, as well as their negligent, grossly negligent, reckless, knowing, intentional, and/or malicious supervision and management of Hertz’s theft reporting process. The individual defendants also owe a personal duty to the Plaintiffs. 494. All Defendants’ conduct, actions, and omissions were negligent, grossly negligent, reckless, malicious, and/or intentional. 495. At all points the conduct, actions, and omissions of the individual Defendants and other Hertz employees was foreseeable to Hertz and done at Hertz’s direction and with Hertz’s blessing. Page 80 of 92 496. Knowing full well that Defendants’ theft reporting procedures and policies resulted in false police reports, and know that Defendants were using the authorities for improper purposes, Defendants nevertheless initiated and continued criminal actions which led to arrest, jailing, and prosecution of Plaintiffs. 497. Defendants acted recklessly and/or maliciously and/or negligently and/or for a purpose other than bringing plaintiffs to justice as they knew or should have known when they initiated and continued the criminal complaint against Plaintiffs that they were not guilty of any crime. 498. Defendants acted with negligence and/or reckless disregard and/or intentional disregard of the probability that Plaintiffs (and many other customers across the country) would suffer severe emotional distress as result of their actions and omissions. 499. Defendants’ failure to withdraw the criminal complaint they initiated against Plaintiffs were careless and/or negligent and/or reckless and/or knowing and/or intentional and/or malicious. Defendants acted with negligent and/or reckless disregard of the probability that Plaintiffs (and many other customers across the country) would suffer severe emotional distress as result of its actions and omissions. 500. As a direct and proximate result of Defendants’ conduct in initiating criminal complaints and failing to withdraw the criminal complaints as set forth above, Plaintiffs have suffered severe damages, including but not limited to monetary damages, loss of wages, physical injury, loss of freedom, severe emotional distress, mental suffering, mental anguish, sleeplessness, restlessness, anxiety, and depression.. Defendants’ conduct was a substantial factor in causing Plaintiffs serious and severe emotional distress. Any reasonable person would be unable to cope with arrest, jailing, and prosecution. Page 81 of 92 501. Defendants’ failure to withdraw the criminal complaint they initiated against Plaintiff was intentional and/or reckless and/or negligent. 502. The acts and omissions of Defendants were extreme and outrageous in a civilized society. 503. The use of the criminal justice system is of the utmost seriousness and innocent individuals who have done nothing wrong should not be thrown in prison without warning and prosecuted for felonies, nor should their name be associated with extremely damaging felonious charges they did not commit. 504. As a result of the intentional and/or reckless and/or malicious and/ outrageous conduct of Defendants, punitive damages are demanded of Defendants. This concerted and deliberate conduct by a company over many years, perpetrated and endorsed by its top officers and directors, is utterly alien to a civilized society and must be condemned and punished in the strongest possible terms. ***** Page 82 of 92 COUNT V – Negligence/Gross Negligence All Plaintiffs v. All Defendants 505. Plaintiff incorporates by reference and realleges the preceding paragraphs of this complaint. 506. The elements of negligence are (1) duty, (2) breach, (3) causation, and (4) damages. 507. Hertz is alleged to be vicariously liable for the conduct of its employees, including the individual Defendants. 508. The individual defendants are liable for this tort due to their participation in crafting the policies and procedures used to prosecute the plaintiffs, as well as their negligent, grossly negligent, reckless, knowing, intentional, and/or malicious supervision and management of Hertz’s theft reporting process. The individual defendants also owe a personal duty to the Plaintiffs. 509. All Defendants’ conduct, actions, and omissions were negligent, grossly negligent, reckless, malicious, and/or intentional. 510. At all points the conduct, actions, and omissions of the individual Defendants and other Hertz employees was foreseeable to Hertz and done at Hertz’s direction and with Hertz’s blessing. 511. Defendants owed Plaintiffs a duty because they rented a car from Defendants. 512. All defendants, including the individual defendants, had a duty to conduct the rental properly and to not falsely report Plaintiffs to the police because (1) Defendants rented a vehicle to Plaintiffs, (2) undertook to file a police report with respect to these persons, and (3) because it was foreseeable that filing a false police report that Plaintiffs stole the vehicles would result in severe damages. All Defendants also undertook to draft, institute, and promulgate theft reporting polices and processes, resulting in a duty to Plaintiffs. Page 83 of 92 513. At all points Defendants had notice that Hertz had a serious problem with making false police reports, and keeping track of renter contacts, but at no point corrected these issues or ceased making the reports. This notice was especially apparent after the September 2017 Grady verdict, the November 13, 2017 order for a punitive damages trial, and a November 14, 2017 letter to then general counsel and executive vice president Richard Frecker detailing Hertz’s problems and failures. 514. At all points Defendants had notice that Defendants were directing Hertz personnel to ignore W7-02(a)(4) and (17), and that they also knew and intended that false police be filed with false information regarding customer payments. 515. The reporting of Plaintiffs to the police with false information, for improper purposes, breached the duty of care. 516. The omissions of Defendants in failing to properly supervise the theft reporting process breached the duty of care, as did the improper management of the theft reporting process. 517. The conduct of Defendants was not only careless, but also malicious, reckless, willful, wanton, and demonstrated a total indifference to the lives of Defendants’ customers including Plaintiffs. Defendants exhibited a conscious disregard for the rights and safety of other persons that has a great probability of causing substantial harm. 518. Due to Defendants’ tortious conduct and omissions, the Defendants have directly and proximately caused Plaintiffs monetary damages, had them arrested, imprisoned, and prosecuted for crimes and conduct they had not committed. They have been falsely labeled car thieves, and has suffered severe damages, including but not limited to monetary damages, loss of wages, physical injury, loss of freedom, severe emotional distress, mental suffering, mental anguish, sleeplessness, restlessness, anxiety, and depression. Page 84 of 92 519. Due to the outrageous, malicious, reckless, and intentional nature of Defendants’ conduct, punitive damages are requested. ***** Page 85 of 92 COUNT VI – Negligent Supervision and Management All Plaintiffs v. All Defendants 520. Plaintiff incorporates by reference and realleges the preceding paragraphs of this complaint. 521. The elements of negligence are (1) duty, (2) breach, (3) causation, and (4) damages. 522. The corporate and individual defendants are liable for this tort due to their participation in crafting the policies and procedures used to prosecute the plaintiffs, as well as their negligent, grossly negligent, reckless, knowing, intentional, and/or malicious supervision and management of Hertz’s theft reporting process. The individual defendants also owe a personal duty to the Plaintiffs. 523. Hertz is alleged to be vicariously liable for the conduct of its employees, including the individual Defendants. 524. The individual defendants are liable for this tort due to their participation in crafting the policies and procedures used to prosecute the plaintiffs, as well as their negligent, grossly negligent, reckless, knowing, intentional, and/or malicious supervision and management of Hertz’s theft reporting process. The individual defendants also owe a personal duty to the Plaintiffs. 525. All Defendants’ conduct, actions, and omissions were negligent, grossly negligent, reckless, malicious, and/or intentional. 526. At all points the conduct, actions, and omissions of the individual Defendants and other Hertz employees was foreseeable to Hertz and done at Hertz’s direction and with Hertz’s blessing. 527. Defendants owed Plaintiffs a duty because they rented a car from Defendants. Page 86 of 92 528. All Defendants’ conduct, actions, and omissions were negligent, grossly negligent, reckless, malicious, and/or intentional. 529. At all points the conduct, actions, and omissions of the individual Defendants and other Hertz employees was foreseeable to Hertz and done at Hertz’s direction and with Hertz’s blessing. 530. Defendants owed Plaintiffs a duty because they rented a car from Defendants. 531. All defendants, including the individual defendants, had a duty not to falsely report Plaintiffs to the police because they rented the vehicles to Plaintiffs, because Defendants undertook to file a police report with respect to these persons, and because it was foreseeable that filing a false police report that Plaintiffs stole the vehicles would result in severe damages. All Defendants also undertook to draft, institute, and promulgate theft reporting polices and processes. 532. At all points Defendants had notice that Hertz had a serious problem with making false police reports, and keeping track of renter payment and contacts, but at no point corrected these issues or ceased making the reports. This notice was especially apparent after the September 2017 Grady verdict, the November 13, 2017 order for a punitive damages trial, and a November 14, 2017 letter to then general counsel and executive vice president Richard Frecker detailing Hertz’s problems and failures. 533. At all points Defendants had notice that Defendants were directing Hertz personnel to ignore W7-02(a)(4) and (17), and that they also knew and intended that false police be filed with false information regarding customer payments. 534. The reporting of Plaintiffs to the police with false information, for improper purposes, breached the duty of care. 535. The omissions of Defendants in failing to properly supervise the theft reporting process breached the duty of care, as did the improper management of the theft reporting process. Page 87 of 92 536. The defendants in this action also breached the duty of care when they reported Plaintiffs to the police for car theft, or the car the plaintiffs were renting as stolen, despite knowing or should have knowing that the Plaintiffs had not stolen the rental vehicles or that the vehicles were not stolen. 537. The conduct of Defendants was not only careless, but also grossly negligent, malicious, reckless, willful, wanton, and demonstrated a total indifference to the lives of Defendants customers including Plaintiffs. Defendants exhibited a conscious disregard for the rights and safety of other persons that has a great probability of causing substantial harm. 538. Due to Defendants’ tortious conduct and omissions, it directly and proximately caused Plaintiffs monetary damages, had them arrested, imprisoned, and prosecuted for crimes and conduct they had not committed. They have been falsely labeled a car thieves, and have suffered severe damages, including but not limited to monetary damages, loss of wages, physical injury, loss of freedom, severe emotional distress, mental suffering, mental anguish, sleeplessness, restlessness, anxiety, and depression. 539. Due to the outrageous and unjustifiable nature of Defendants’ conduct, including the years of notice that it was occurring, punitive damages are requested. ***** Page 88 of 92 COUNT VII – Unfair Trade Practices All Plaintiffs v. All Defendants 540. Plaintiff incorporates by reference and realleges the preceding paragraphs of this complaint. 541. The Hertz defendants advertise the company as number 1 in customer service. 542. Defendants, however, do not inform customers that they have known for years that they deliberately and routinely files false and unverified theft reports against customers. 543. Defendants do not inform customers that they not only instruct employees to disregard policy safeguards against false police reports, but that the policies are deliberately crafted to result in false reports. 544. Defendants advertising and marketing schemes, including their material omissions, are fraudulent and improperly do the following: 545.  Representing that goods or services have sponsorship, approval, characteristics,  ingredients, uses, benefits or quantities that they do not have or that a person  has a sponsorship, approval, status, affiliation, or connection that he does not  have;   Representing  that  goods  or  services  are  of  a  particular  standard,  quality  or  grade, or that goods are of a particular style or model, if they are of another;   Advertising goods or services with intent not to sell them as advertised;   Engaging  in  any  other  fraudulent  or  deceptive  conduct  which  creates  a  likelihood of confusion or of misunderstanding.  All Plaintiffs relied on Defendants advertising and marketing when renting a car with Hertz, and had they known Hertz’s actual customer service philosophy would have never rented with the company. Page 89 of 92 546. As a direct and proximate cause of Defendants’ deceptive and fraudulent advertising and marketing scheme, all Plaintiffs suffered severe damages, including but not limited to monetary damages, loss of wages, physical injury, loss of freedom, severe emotional distress, mental suffering, mental anguish, sleeplessness, restlessness, anxiety, and depression. 547. Plaintiffs request punitive damages, treble damages, or other exemplary damages due to the outrageous conduct of Defendants. ***** Page 90 of 92 CLAIMS FOR RELIEF Wherefore, Plaintiffs demand judgment in his favor on all Counts and against Defendants, jointly and severally, for an amount well in excess of the jurisdictional amount required to guarantee a jury trial. Plaintiffs request that this Court determine and declare that Plaintiffs are additionally awarded and afforded on all Counts: (a) Compensatory damages, inclusive of any and all harm attributable to Defendants’ actions or inaction, including for loss of freedom, improper prosecution, physical injury, miscarriage, mental and emotional damage, monetary damage, and lost wages; (b) Punitive damages to punish Defendants for its outrageous conduct, self-interest, and duplicitous behavior; (c) Exemplary damages to set an example for others; (d) Attorneys’ fees and court costs; (e) the loss of time and opportunity; (f) lost employment opportunities; (g) Delay damages; and (h) Restitutionary disgorgement of all profits Defendant obtained as a result of unlawful, unfair, and/or fraudulent business practices; (i) Mental and emotional pain and suffering; (j) Punitive and exemplary damages to punish Defendant and especially to deter other companies from acting in such a manner; (k) Costs and attorney’s fees; and (l) Prejudgment interest; (m) Such other and further relief as the Court deems just, necessary, and appropriate under the circumstances or allowed by statute. Page 91 of 92 SPOLIATION CLAUSE Plaintiffs demand that Defendant stake necessary actions to ensure the preservation of all documents and things related to the case—in any format—hardcopy, electronic, audio, and visual. Defendants are also put on notice to preserve all things including but not limited to information, materials, communications, or other content/data related to the averments in this case. DEMAND FOR JURY TRIAL Plaintiffs herby demands a trial by jury on all claims and issues so triable. Dated: May 21, 2020 Respectfully submitted, Of Counsel: FARNAN LLP Francis Malofiy Francis Alexander, LLC 280 N. Providence Road, Suite 1 Media, PA 19063 Telephone: (215) 500-1000 Facsimile: (215) 500-1005 francis@francisalexander.com /s/ Brian E. Farnan Brian E. Farnan (Bar No. 4089) 919 North Market Street, 12th Floor Wilmington, DE 19801 Telephone: (302) 777-0300 Facsimile: (302) 777-0301 bfarnan@farnanlaw.com James E. Beasley, Jr. THE BEASLEY FIRM, LLC 1125 Walnut Street Philadelphia, PA 19107 (215) 592-1000 Attorneys for Plaintiffs Page 92 of 92 EFiled: May 21 2020 Transaction ID 65652125 Case No. N20C-05-189 VLM EXHIBIT 1 - - . ' -, . . - . ' - ·. . . ' . . . ·. · Procedure Owner: . Senior Exec~tive VicePresident, Chief Administrative Offic~r and General Counsel • · Process Owner: , • I Vice President, Corporate Operations •· • Executive Summary ·, . · .· . . . . . • fhis Worldwide procedure applies to the Rent-A-Car (RAC) Division qf The Hertz . 'Corporation and includesrequfrements for rep01ting vehicle thefts and conversions. AU.Heitz.'vehkJ,e.thefts .·and conversions must be documented· on the. Theft/Recovery Vehicle ~ep01t. .· · · · ·· · · ·. All vehicle thefts from customers must. also be documented on the Vehicle Theft from .Customer Rep6rt. · . · . • Location; Maintenance, Area, Cquntry Head Office and. OK,C J:v[anagement must ensure compliance tb this procedure. · · . Key Revisions ·Section G covedng retail car sales repossessionwas added: PrQcedure · . No. . . .. W'7"02:RAC: ·Scope: • Purpose: . Subject . REPORTING· •·VEHICLE .. · ' CONVERSIONS THEFTS AND . ·Date . July23, 201s This.Worldwide Proced~e applies to the North American Rent~Accar (RAC) bi~ision, including Canada and Puerto Rico/St. Thomas. . To provide the guideiinesfor reporting andptdcessing:retaiicar sales. . .Index: •. ·Closing Associated' Rental AgreernentS Reconciling Open Theft/Conversion Files to .CARRENT and VISION •·.· ·. Distribution of Con).pleted Theft/Conversion Report· · ·Retail Car Sales.~epossession .. Procedure: A. Gerietai ]. All thefts, conv<;rsions and disappearances of Heitz vehicle~ .must be reported to the police. as soon a.s discove.red anq ].llariagement must.assist the. police '.Vith both. their · investigatioii and the recovery of the vehicle: · · · · · · Conversi~ns c Report conversions to police no iater than 60days from the original · o(extended due date (eonsiction. · · · · · · b. . · 2. . ' \ ' The Theft/Recovery Vehicle Report(Fotm 702003P - available in i~forms) must.be utilized to report each incident. V~ndalism - Th() theft, conversion pr disappearance of parts from a rental vehicle a. while the vehicle is out.on nmt of\n control bya person hot employed by Hertz is · considered vandalism and rep01ted in accordance withPi'ocedure W7"0I, Reporting VehicleAccidents. · ·· · Unauthorized Access .~. Unauthorized access to Heitz property when Hertz . vehicles are stolen must be reported on a Worldwide Breach of Security Repoit, . in accordance with Procedure Vy'l-41, Breabht!S of Security. . . . .. . b. 3. There are four .• (4)vehicl~ theft c~tegori~s: Theft by Conversion ~refer to Procedure Wl.-12 RAC, Controlling Overdue Rentals· . Theft by Fraud~ refer to Procedure Wl'l2 RAC, Controlling Overdue.Rentals Theft from Hertz Premises - refer to Procedure W9-18.RAC, Controlling·Vehicle Physical Inventories · · · · · · • • Theft fmm Cu.stomer - refer to Section Cof this Procedure 4. Prior to Reportiiig Thefts to.Police -Ensure requireinents outlined in Procedu.res Wl,12 and w9-I 8 were followed, prior tO: reporting a vehicle missing from inventory and reporting thefts tq poli~e. In (!ddition, a ·Missing Vehicfo Checklist has been developec! · and must be . completed by .the specific individuf!ls. conducting research of· missing . · : vehicles, prio1: to reporting thefts to the police (tefer to ProcMure W9-l8), , 5: ·Complaints or Warrants - In jurisdictions that require a complaint or warrant be lodged against the renter prior to alarming the car, the responsible Corporate/Country Security · Manager. (North America/Brazil) or an appointed designee has it maximum of ten (I 0) · additional days froin r('Oceipt of the file· to complete i-esewch b.efore ·reporting the . · conversion: (refefto Proc~du,re \V1-12 RAC). '6, Authorizing Arrests or Prosecution" No level of.management will ai,ithorize an arrest or. prosecution. on behalf of Heitz, nor wili arty employee sign any· 9rimin11l com'plaint against ari individual or\' behalf of Heitz, without the express approval .of 1) the . . . . - . . -' . . ' ._. . ' ; '" . ' - -. . ' - . ·,- . - ' ': .. ; - ' ' - ' ~-· - . . . : la~yer responsible Corporate/Country Security Manager or a. .in the Law or Hilman. Resources Department, P~rk Ridge/ Legal and Corporate Affairs ,Department, HEL an,d 2) in the. case of the arrest, pi·osecution or filing of a criininal comph\int against a . current ot recently terminated employee, the express appro:Val of. the Senior Vfoe President, Labor Relations and HR Practices;I'ark Ridge. · · • · · ·· . Note: The only allowable exception is fot the reporting of pe~sonally witnessed vehicle· thefts, where the employee who witnessed the vehicle.theft may cooperate with the.· · law enforce111ept •authorities, if requested, but must immediately advise the · responsible Area/Location Manager. · · 7. Pol foe . Removal of· Heiiz Property · " If in connection . with a theft/conversion/disappearance, the police remove any property froqi Hertz premises, cus~ody or control, it js the responsibility of th.e Area/Location Manager (o~ delegate) to obtahi a receipt from the police, if one is customarily giyen: · · . . 8. Timely Notification of Theft Information - Individuals who are advised of a theft must notify the Hertz personnel. respor)sible for. prepiiring the Theft Vehicle· Report (refer to . Section B. l below) of alarm/report details (date reported, reported to, alarm nuinber, ete.) within one (1) workday of receipt or infor,rriation fr01)1 therepotiing police agency s.o that . the TheftVehicleRepmtean be comp!~ted and distributed timely (refetto Section F). l ' ·,- ' No1ih America Conly) - Send all relev11nt theft informatiori/documentaticm to , OKC Vehicle Control at QKCtheftandrecovery@hertz.com. ·· · a. . . ' ' . . - .r 9. Police Refusal to File Report- If for any rea8onthe police.are unwilling to file a repolt . of thefl:/conversion/disappei\rance, indicate this fac.t on the Theft .Vehicle Report, in the pofice file or alarm/report number section. Immediately contactthe. Corporate/Country Security Manager responsible for the location wh~re the .vehicle was rented or missing, . who will Workw~th the Corporate Legal Department to resolve issues. ·· 10. Thefts .from Cusfoiners -All thefts arid disappearances of vehicles from custinner while on tent must be reported to the police authorities by the customer (refer to Secti9n C). . . . . . . 11. Updating Systems for Veliicle Hot Status , One~ alarm/complaint information on reported thefts, conversions or. disappe\lrances has been received; the OKC Vehicle Control Depattment.(North America), OW11ing Country Car ControJ·Mf!nager (Europe), eI)ter all initial alarm information and National Beet Accounting Manager (Austraiia) chang~ the vehicle' status tci ·"H'' (Hot) in the CARRENT Theft and Convc;Tsion systern. (Br~il and New Zealand must be updated in V1SION) and also their applicabl~ cannier· system (i.e., ASAP/"G" (Theft), "H" (Stolen) or ~'W" (1rue Conversion) in CARS+, etc.). · a will • Nqte: .In Canada, refer to System Inf~rrnation .& Ti:aining Bulletin #5835, Car Control• Hold Codes in CARS+. . .· · . . · . · , ' '12. . ;. - - " '· ' . i ' .. ',-.. . . - . - .• ' . . • ', ·. Preventing Rentals of Hot/Stolen Vehicles - Every attempt must be made tQ prevent . · • ·Hot/Stolen vehicks from being rented or incurring non:revenue moves. . · · · · . Once the ~ehicle. "Hot" stf!tus is. entered iii the applicable rental counter system (ASAP, .HLES, TAS, CARS+, HTZRENT), this will assist )n systematically. preventing the rental of a ~tolen vehicle until alarm cancellations are processe' complete the-Vehide Theft froni"CustOriler Ryport (Farin 702005P). Refer to SeCtiOn·C. · (2) The theft package muSt be forWatded tO .-i:he last known i-Iertz-Iob"ati~n to haye posseSsiOn ofthC,vehicle. 2. The Theft/Conversion Report must be completed as follows: • . Check "Initial Report" and then identify the type of theft (as stated iri table abo~e); . • The repott must be typed and a.11 the required infotdtation (unit, description; serial, license nui:nbets, .etc:) recorded in the . "VehiCle Desp'iption'.' section. All· information mustbe accurate to ensure· reporting poJ!ce ·agency records and alarms the cori'ed vel:iicle. Wheneveipossible, n>cord vehicle information from a copy of vehi6le's ·registration. and att~ch a copy to· the 702003P being pre~ented to th~ police.· · · ·· · · . Note: Odonieter re~ding - is the Vehicle's last recorded mileage bef0re the theft occtirred; if stolen· from lot. If on rerifal, the. actual ,;out" mileage recorded on .•. b~ . . ... Enter the information required in the "Rental Information" area .. If the vehicie was · not on rental when stolen, leave this section blank arid indicate in. "Summary of What Happened" section that . the vehicle was not rehted and the exact .' ,. cit'cumstances of theft (fast known date, mileage: etc.). · • \ Ent~r all available information about the renter (if applicable), Enter all· alarm information (poli~e authority reported to, .date reported,. Iocatfon ·of • • . vehicle at time of theft, etc.). In.the case of Conversions, enter the due date as the ·"Date & Time Stoleri." If the vehicle was. stolen from 11 renter, the "Date & 'Lime Stolen" is generally the date the vehicle was. di$c9vered missing; If the vehfole was stolen. from Hertz' premises, t)ie "Date & Time ·Stolen" is .the. date of .the last movement, unless. the theft. was actually witnessed.. This date appears on the Depreciation Run, the VISION RAC Aging of Conversion Report and is used by OK.C Fleet A6coltl1ting to determine the write-off date if the vehfole is not ·' · · · · · recovered. -. , Where a . ' ' ' conVet~ioi1 h~s· occurred .and .the C(ri.mter":Represe~t~tive fem.einber~· fue~ -· '. _- ·_.' '' •, ' ' '· ,I - . - _, description of the customer, or if the theft was witnessed, enter it in "Description 6f ·Renter or Suspect" section (where applicable). · • Use summary section to document any additional facts obtained pertinent to the Theft/Conversion beingrepoited: · • · Signa\ure ofthe resp~nsibl~ HertZ management etilp!oyee completing the report, · ' includittg'the date. .. C. Vehicle Thefts from Customers . 1. Whenever a cust6mer calls orls present at the rentalcounter,and re]JOrts that theyehicle .has been stolen from them; advi$e t~e cust9mer that 1;o the e)(tent PC?Ssibfo, they are respsmsible for repmting the theft to the police. · · · · ·· a. Whenever .a customer ..indicates they renorted the. the.ft to the police/ optain all required .information (date reported, agencyreported to, police complaint numbei-, etc.) and contactt~e police to eon:firmthe theft details. · . . b. If not' reported, advise the·.cuitomer to immediately tepo1t the incident to ·the . police and caIJ Hertz back with the required facts. .. · '.- c. . I '. If the custom~r is unable. or refuses to rnpoit the theft to the Police, the Theft · Vehicle Rep01t .(702005P, available in. iFoims) is ·prepared by the individuals outlin<0d In Section B. and forwarded to the a location In the·· area/jurisdiction where the customer claims fhe theft occurred. · · -. :'· ' . ' - . ' ' -- ' ' . . . ' : . ' -· .- . Note·: In l/S Cities which have access to Department of Motor. Vehicle (DMV) files, management can. confirm .alarm. status by entering the full serial number. into the . · DMV systemc ' 2. 3. ' ' . . : - ., Regardless of whether 1'eported by the customer ot subsequently by Hertz, d0<.oument all details ofthe occurrence (date, time, location of vehicle· at time .of' theft, etc.) on a Vehicle · Theft from CustomerReport (an equivalent iocaUanguage translation can be used where· ,· r"quired) and ln ;ill cases, every attempt,must be made to qave the cust9mer sign the form ... Whenever.possible, have a: Manager speak with the.customer to record this information. If the wstomer was·. owrduefn:nn tl~eir original rental due date. and is. now reporting the ..vehicle has been stolen from them, 9ontact the OKC V.ehicle. Control. Department (No1th America), Cal' Control Department (Europe 'and Brazil), Fleet Accounting Manager (Australia), rllsuranc;e Manager (New Ze~land). Jt is possible that "Locators'; or · "Rettieval" servides were. utilized . .to repossess the vehicle from the .custome'i· and therefore, it must not be .reported st6len. · · 4. Have the customer tµmin, or send in thy !mys .and rental documentation to tliyvehicle. · If it is detennined that the customer left the keys in the vehicle prior t9 being·stolen or · any of the details suriounding the theft are unusual, refer to Procedure W7-42, Do Not. Rent and iinmediately c011tact the n:'sponsible Corporate/Count1-ySecudty Manai;er. 5. The completed Vehicle Theft from Customer Repo1t mustbe forwarded immediately to the Responsible Manager (i.e., Area Man~ger of the Reriti11g City (N0rth Americ;i and Brazil), Country Security :Managers Delegate (Europe), National Fleet .Accounting (Australia)) who must then ensui·eit is forwarded to those. identified in Section inorder. ·. for the Theft/Conversion Repott t9 be preparedc Additiorn,1lly: . · · B: • · The OKC Vehie!e Control Department (Nprth America)lCar Control Department (Brazil).must immediatdy verify information with the police, upon receipt. ·. · ·• Au~tralia Locations must verify with. the police before. sending to National Fleet Accou11ting,'oncereceived a scanned copy must be forwarded to International Fleet Accounting, OKC to enter into. VISION.· tb All-vehiCle·thefts from customers and incidents of vandalism must be reporteq the. Fir~t Notice of I.:oss (FNOL) Office . (North America) )ir the responsible HCM/Country Claims Dep~rtment (all other Countries) daily · . D. . ' ' Closing AssodatedRental Agreements 1. . The 0K:C Vehicle Control Department (North America), Car• Control Department· (Bra'lil), Lociltibn/Branch Managet (Europe, Australia and New Zealand) inusi <;lose · the RA after verifying theTheft Vehicle Report with.police. Therefol·e, North America and )3razil rental locations must not close the RA or perform.an exchange on the RA.. . 2, . Once confirmed that .the. theft/conversion · has been reported to the police, the . responsible .. management - (as . listed aboV'e) must . Close .. RAs .. in . the . ASAP/TAS/CARS+!H:TZRENT Post' Return or.BCHCLOSE applications by:- . . .· . . ' .. · Entering an approxifi!ate 'mileage in\ estimating 10 miles/100 kilometers per day . .. :. - ·.. ._, . - .. - '''Recording the-date the vehide was reported stolen in the 'return date and time' field. • ' • ' ' ' ' ' _ -' ' Ens~ingthe Rent and Return locations are the same .... "' • ' ' ; . • . Applying the 'best' or lowest rate available. • . E. Providing background i1lformation (<.<.g:, theft fr0m renter, daterepci1ted, etc,), in the 'remarks' section. Note: If deterinineC! that a chargecard was Used fraudulently and the true canlholder did not rent, close .ciut the RA anc! only bill for the amount authorized· by. the. card company attime of rental. bn cash ·rentals later confirmed to be fraudulent . ·. rentals (e.g., stolen passport, stolen company ID, other) the bi.11 mlist be no gi'eater · · than. the amount of actual deposit taken, 86 the final net due equals zero.· . . ,_, . ', ' ' .. Reconcillng Open Theft/ConversionFiles to. CARRENT 1. 2. . . ·, a~d VISION It is.·. critical.. that every open . Theft/Con~ersion Vehicle . Report ·• af each reporting . City/Counfry be properly re.corded as such, both ih CARRENT (except for Brazil and . ·. New Zealand where CARRENT is not currently utilized) arid. in VISION. To verify this; each. Owning City/Country Car Control Manager, Fleet Manager (North America, Brazil and .Europe)/Fleet Acconntirig Mimager, (Australia) or designated . · e~ployee must perform a monthly reconciliation of all active Theft/C\mversion files. · a. . Compare all open Th~ft V~hicle Reports t~ the monthly VISION RAC Agifig of · Conve~siori Report. All open thefts/conversions must appear on this report with a Depreciation status code Gf ''C"(Active Conversions). · b. Allopen Theft/Conversion Vehfole Reports must also appear in CARJmNT · with a status code of "H" (Hot). Responsible Management must either· compare. all files to the CARRENT Theft and Conversion By Unit Report or to a user OLQ report that lists all "H" status vehicles.· . . created . , - c. · Investigate. any active Thef't!Conversionfil~s that are not appearing as such on the VISION RAC Aging of Colwersion Report (or equivalent country report) or ·in CARRENT, Documentno~ations ofvarianc<0s, r~latedresearchandresolutions. · ori reports. Contact OKC, Vehicle. Control (North· America) /OKC .Fleet . Accounting ·.(other Conntries) directly for items. not appearing on the, I . VISION RAC Aging of Convers.iim Report. Add any active Theft/Conversion files )lot appearing in CARRENT immediately. . Note: Whenever funetiof1al, RDS Reports must be rev.iewed oil line, annotated as ·required above in Document Direct and retained. in RDS. F. Distribution of Completed Theft/Conversion Report . On completioli of the Theft Vehicle Rep01t, and after confirming thyft details with the police, · · . distribute immediately as follows: • r ' ' • . Copy . . _Europe Brazil _OKC VehiC!e Co'1trol OKC Fhiet Accom1ting OKC . . (l) (1) Department ( 1) _tJ¢M: ·-First Noiic~·.of, C0Untry Jnsuraric'.e Ne'v Zealand·. .. .... DePri.ninent, Dallas ~· ' Owb.i11!?; Cou~try Car . Control Manage·r Owning.Ar~ Cai O,wning Country Car COntrol Manager · ' 4 RispOn~lble Corporate Sec~rity ¥allrigef O~i~g Country Car Control & State .Distributioii ·Manager ' ReSporiSibl{: Corporate ·RcsPonsibl~ Colintr)' Security Manager · Security-1".lan