Anderson Chevrolet of Los Gatos, along with Anderson Cupertino, Inc., will pay $45,000 each in civil penalties and costs while enforcing methods to prevent future violations of a state vehicle law.

According to Santa Clara County Deputy District Attorney Robin Wakshull, with the Consumer Protection Unit, customer inquiries brought to light information that alleged the auto dealerships were practicing false and misleading advertising as well as unfair competition.

The customers complained that when purchasing vehicles at an advertised price they were required to purchase a vehicle theft protection and registration program, costing an average of $219. "The dealerships have to sell the vehicle at the advertised price, and they can't make the purchaser buy any more," Wakshull said.

She added that a section of the California Vehicle Code requires advertised vehicles to be sold at or below the advertised price. She said requiring customers to purchase the VTR at an additional cost other than cost for taxes, vehicle registration, tire and document fees is not allowed.

Without admitting to any wrongdoing, both dealerships agreed to settle the lawsuit July 29. The auto dealerships will be responsible for establishing a program for eligible customers who purchased advertised new or used vehicles between October 1998 and July 2000, Wakshull said.

Marc Cannon, spokesperson representing the two dealerships, said their focus "is always on serving the customer." He said they have been working with the appropriate officials to resolve the issue as quickly as possible and is estimating that only "a handful" of the letters being sent out will result in refunds.

Wakshull, however, estimated that between 400 and 500 customers will be receiving letters in the mail who purchased vehicles during this time period. Those customers who purchased the advertised vehicle may be eligible for a refund for the VTR fee they paid and may be allowed to cancel their VTR program.