Hertz agrees to pay $168 million to settle allegations its customers were being falsely accused of stealing rental cars — and even sometimes arrested

  • Car-rental company Hertz has agreed to pay $168 million in settlements with hundreds of customers.

  • The company faced allegations its inventory issues have caused false reports of stolen cars.

  • Hertz said the settlement will resolve almost all of the over 360 pending claims against it.

Car-rental company Hertz has agreed to pay around $168 million to settle with customers who allege they were falsely reported for stealing rental cars, with some facing what they say was wrongful arrest.

The company announced that the settlement of 364 pending claims related "to vehicle theft reporting" would resolve over 95% of pending claims against the company. Hertz said it will pay the $168 million "by year-end to resolve these disputes."

The company doesn't expect the settlement "to have a material impact on its capital allocation plans for the balance of 2022 and 2023." Hertz expects to "recover a meaningful portion of the settlement amount from its insurance carriers."

"As I have said since joining Hertz earlier this year, my intention is to lead a company that puts the customer first, Stephen Scherr, CEO of Hertz, said in company's statement. "In resolving these claims, we are holding ourselves to that objective."

One of the customers who joined the class-action lawsuit against Hertz for the false theft reports was arrested four times, according to the lawsuit.

In October 2018, Antwanette Hill, a platinum member of Hertz's Gold Club loyalty program, was arrested after she used her membership to book and check out a rental car without alerting a Hertz staff member at Atlanta airport, Insider previously reported.

She was arrested three more times after the incident, from 2019 to 2021, because she failed to appear in court due to not being notified about the court dates, the lawsuit said, adding that she spent around nine days in jail each time she was arrested.

While in jail in May 2021, she suffered a miscarriage, and was hospitalized for three days.

The lawsuit Hill is part of stated that, "Hertz knows that its tracking and inventory control is broken, but reports the cars as stolen anyway."

Francis Alexander Malofiy, a lawyer working on the class action lawsuit, previously told Insider that Hertz didn't retract its false theft claims so it can protect its relationship with law enforcement.

Another man who rented a car through Hertz's subsidiary, Thrifty, was surrounded by armed police 30 minutes after renting a vehicle because the company had reported that car as stolen.

Nicholas Wright previously told Insider that his then-13-year-old daughter, who was with him during the incident with police, is in therapy and struggles to see law enforcement out on the street.

"As a 14-year-old young lady that is going to be a long-term thing that she's probably going to struggle with for the rest of her life," Wright told Insider. "Hertz needs to be held accountable."

Scherr acknowledged Hertz's role in false arrests on CNBC in May — a flip from previous years of denials from the company, and said the company implemented policies to stop the false arrests.

When the company filed for bankruptcy protection in May 2020, most of the legal claims around false arrests went into bankruptcy proceedings, The Wall Street Journal reported. But lawsuits show false arrests continued to happen after Hertz emerged from bankruptcy proceedings last July.

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