Gag Orders - How Carmakers Buy Your Silence

I guess being bound and gagged can be quite OK (with that special someone). But when a carmaker does it to you it’s just unpleasant, unprincipled and grubby. And it’s very, very common. This is the untold story about carmaker customer coercion - duress as a mechanism for shutting you up.

This report highlights the grubby car industry practise of coercing customers like you into signing ‘gag orders’ - which are also known as ‘non-disclosure agreements’. This is common practise in the car industry in Australia - it’s unlawful and unethical, and limp-wristed regulators allow carmakers and their arsehole lawyers to walk all over consumers, routinely, in this way. It works like this.

Let’s say you have a rolling series of problems with your new car. After months of complaint, multiple trips back to the dealership, the brush-offs, weeks off the road, the failure to rectify the problem - if you are pushy enough, the carmaker might just offer you an off the books financial settlement. But there’s a catch: They’ll want you to enter into a contract.

Never mind that the Consumer Guarantees have been in place for five years, and carmakers routinely breach them. I did an earlier report on why we need lemon laws >> 

The proposition here is: We’ll pay you out - but only if you agree to be bound by a contract that shuts you up. The point here being, the Mafia does business this way.

Carmakers are obsessed by what is said about them in the public domain. Obsessed. It’s like boardroom hubris and ego-mania spiralling out of control. Extreme narcissism. If an individual was that overtly self-obsessed, they would require acute psychiatric care. Gag orders are the result: a grubby little assault on the freedom of speech. Because a carmaker hates anyone who says bad things about them.

You’ll be required not only to shut up about the settlement, but also to refrain from disparaging the brand in any way. No comments on Facebook, or Twitter - nothing. Strictly speaking, telling your friends or family would be a breach. The agreement will doubtless extend to bind your family in the same way. And you won’t even be able to disclose the fact that you’re in a non-disclosure agreement, nor what the terms of that agreement are. Arseholes.

Entering into a gag order with a carmaker allows them to sue you for breach of contract, potentially, if you breach it. But they might also seek an injunction against you in court if they get wind you’re about to speak out - and if you breach an injunction you’re guilty of contempt of court, which is something the courts take a very dim view of, and could land you inside, playing mummies and daddies with Bubba - where you get to be mummy.

See also: Ford Focus lemon >>


This all came into stark relief for me when I flew up to the Gold Coast to cover the ‘Tank My Lemon’ event for Channel Seven’s Weekend Sunrise, late in June.

OK - so two things. One: the Centurion Tank is now officially my preferred mode of peak-hour transportation. There’s no congestion problem on Sydney roads that a Centurion tank cannot solve. And, when you get to your final destination, you may park anywhere you want … even in spaces that are already occupied. And two: the back-story. Very interesting.

Joe and Kate Masters are a nice young couple. They reached the end of their tether with the recently squished shitbox Dodge Journey, which was defective in about a thousand interesting ways.

Fiat Chrysler ran them around like a Barnum & Bailey three-ringed circus, and according to Joe Masters, they were told Australian Consumer Law was (quote) “for toasters” - meaning it didn’t apply to vehicles. Unbelievable.

So they tanked their lemon.

Quite publicly and cathartically. Hundreds of thousands of people have now seen it - either live or subsequently online.

See also: Bad Cars of the Year >>


At the 11th hour, Terry Fitzpatrick, Fiat Chrysler’s Senior Manager of Customer Care (one of the universe’s most nonsensical job titles, when you think about it) wrote the Masters a two-page letter designed, as far as I can tell, to be a thinly veiled, nonspecific threat, with the balance being arse-covering and second-rate emotional coercion.

This company’s conduct is unbelievable.

I have reproduced Mr Fitzpatrick's letter in full, below, so that you can make up your own mind on its tone and manner. (Click to enlarge the pages.)

In paragraph one, Fitzpatrick, essentially, calls the Masters liars. (Nice attempt at diplomacy up front.) In paragraph three Fitzpatrick decides to quote “leave aside the non mechanical irritants such as the music system and the alarm not properly functioning”. (Because, after all, who would want that to work properly in a brand new car?) Paragraph four defends the shitbox Dodge against the Masters’ allegation that it’s not of merchantable quality.

Last couple of paragraphs - just nonspecific threats.

“Our company will be watching closely your conduct in connection with the forthcoming destruction.”

And this:

“By crushing the Dodge, no one will ever know the truth of the statements you have made.”

(It seems in that sentence he unwittingly acknowledged the underlying truth of the Masters' allegations...)

Anyway, thank you very much, Terry Fitzpatrick. (I wonder how many of you, reading this report now, are forming the view Mr Fitzpatrick is a bit of an arsehole, working for complete arseholes? Quite a high proportion, I suspect.)

Anyway, in the lead-up to the event, Teg Sethi, of Lemon Jeep YouTube stardom, pledged $750 to the Masters via social media for their event, and appeared in a tank teaser video. You Remember Teg.

See also: Lemon laws in Australia >>


So, Fiat Chrysler’s arsehole lawyers, Corrs Chambers Westgarth (presumably ‘Buttcrack Anus Derriere’ was already taken…) wrote immediately to Teg threatening an injunction because disparaging Fiat Chrysler in any way would be a breach of Teg’s gag order, which he entered into to get paid out after essentially arse-raping Fiat Chrysler on YouTube with 2.3 million views of his ‘Jeep/mistake’ video above.

I've reproduced the lawyers' letter below in full, so you can make your own determination on that as well. Click to enlarge the pages.

Stephen Stern, from Fiat Chrysler’s lawyers, made a total of nine written demands on Mr Sethi and concluded:

“If you fail to comply strictly with these demands within the time limits set out above, we expect our client will immediately seek an urgent interlocutory injunction against you.”


Here’s how arsehole lawyers work. It’s counter-intuitive: If they really want an injunction, they just go to court and procure one. Simple.

But a threat of an injunction is an entirely different flavour of arsehole lawyer act. It generally means: ‘We don’t really want to do that. We’d rather you just shut up.’ And the reason why they would rather you just shut up, Teg, is that, generally, the underlying non-disclosure agreement is unlawful.

They'd hate it for that to get around, and so would their client, Fiat Chrysler.


The Competition and Consumer Act prohibits a company from using undue harassment or coercion in connection with the supply of goods. Common Law permits a consumer to escape gag order-type obligations if the consumer can establish duress. And duress is, basically, illegitimate pressure - such as where a big, well resourced arsehole corporation like Fiat Chrysler threatens not to comply with its legal obligations under Australian Consumer Law unless the gag order is signed.

Do you really suppose Fiat Chrysler and its minions from Buttcrack Anus Derriere want to go to court, seek an injunction, and come home that night with their testicles mounted on an oak plaque in formaldehyde as a consequence of the original gag order being found to be unlawful? Because that would open the floodgates to all of those gagged customers suddenly being empowered to speak freely about widespread car company coercive conduct.


In a recent survey, Australian consumer advocacy agency Choice found gag orders were imposed on an incredible 16 per cent of those who experienced warranty problems. That’s about one in six. It’s hard to get accurate figures when the gag order prevents you disclosing that you’re in one. It’s a staggeringly high percentage - and it points to widespread gag order proliferation in the aftersales environment in Australia. It’s how car companies do business.

Choice Lemon Car Reliability List >>

Teg Sethi’s gag order is absurd. One of the conditions in it required Teg to ensure that his then one-year-old son would make no disparaging comment about Fiat Chrysler, its employees, the products or the dealerships. One-year-old. Really. They did. I read the entire agreement before it became binding. It’s an ethical disgrace, and an assault on the freedom of speech - one of the most fundamental freedoms we enjoy.

"You will not make, cause to be made, or associate yourself with, and you will procure that your associates (your spouse, children, siblings and parents) do not make, cause to be made, or associate themselves with, any statement or comment, which disparages FCA, its employees, agents, any Dealership, or any products distributed by FCA or any services provided by FCA or any dealership."
- Clause 7 of Teg Sethi's gag order.


Can you imagine how much it costs to put Arsehole Buttocks Derriere on retainer? To park a private detective outside the Tank My Lemon event and film it in its entirety? To say nothing of the reputational damage that flows from this kind of activist-based anti-marketing? Hello? What’s the opportunity cost of devoting all these resources to the dark side of car company customer so-called service?

These arseholes are behaving like the frigging Stasi. The KGB could learn new tricks from these scumbags. And you know what? It’s all pointless. The cone of frigging silence doesn’t work. The details inevitably leak to people like me, the story gets out, and the brand looks even worse than before - if possible.

To be fair, it’s not just Fiat Chrysler - they are undoubtedly the worst - and comfortably in front, but unlawful gag orders are standard operating procedure for all the big carmakers. They’re all doing it. And it has to stop. The law is the law, and these organisations need to obey it.

They need to fix the problems, refund or replace at the customer’s discretion in the event of a major failure - because that’s what the law says - and retain customers by impressing the shit out of them with actual service. Terry Fitzpatrick and people of his ilk behaving like some de facto car company secret police service is not a long-term pathway to sales success.


Of course, the ACCC is doing precisely what it usually does in relation to consumer-centric matters like this. Bugger-all.

It’s like absolute zero: there’s no ‘less than that’ which they could be doing.

Australia’s most useless, toothless government department. Sitting in the corner with its dick in its hand, metaphorically. Unconscionable.

That's your tax dollars at work.


Teg Sethi proved that there’s a real place for individual consumer advocacy, and technology certainly has empowered us as individuals to take a stand. You know, previously, if you had wanted to launch a music video, you’d need a record label, and airtime on conventional media. Today, all you need is creativity and a free YouTube channel.

Music has always been a vehicle for social comment and especially anti-establishment social comment. It’s a great way to protest the status quo, and engage an audience that doesn’t necessarily watch the nightly news. An audience that might care about, or be impacted by, this kind of conduct.

I’m very pleased to say I’m launching this report on the day Teg Sethi is launching his next YouTube music video, which will hopefully also go off. Teg’s new song is about gag orders, and there’s even a cameo in it by a short, fat, bald, middle-aged reporter who feels pretty strongly about this issue of widespread corporate bastardry. Take a look at it below.


Hopefully Teg’s fat beats and busted moves will reach places mine would never go. For long-time viewers of this channel - there's a special treat in that cameo. Without wanting to let the cat out of the bag, the mighty AutoExpert fishnets are back, loud and proud. Enjoy that. I know I did. (And I’ll have you know the models were really nice girls too. Really nice. I love my job. (In case you were wondering.)