The Data Fight Gets Uglier—And FTC Loses Big

“Tekion alleges CDK used its dominant position to block access to dealer data and penalize those who attempted to migrate to rival systems.”

INDUSTRY HEADLINES

Tekion Sues CDK Over Data Lockdown Tactics

Tekion just filed a federal antitrust lawsuit against CDK, accusing them of deliberately making it harder for dealers to switch platforms by withholding critical operational data.

The allegation: CDK is holding dealers’ data hostage to stop them from choosing another DMS provider. In some cases, CDK even sued its own customers for trying to access their own data.

The example: Asbury Automotive Group had to get a court order just to retrieve their own dealership data for a Tekion pilot program. CDK refused to hand it over until a Georgia judge forced them to.

Why this matters: If your DMS provider controls your data, they control your business. Period.

👉 Read the lawsuit

Takeaway:

Review your contracts. Get clean data exports. Set up backups. Don’t let a vendor box you in.

FTC’s CARS Rule Struck Down by Appeals Court

The Fifth Circuit Court of Appeals just killed the FTC’s CARS Rule—the regulation designed to ban bait-and-switch tactics, junk fees, and hidden add-ons.

What happened: The court ruled the FTC violated its own procedural rules by skipping required steps in the rulemaking process. NADA and Texas auto dealers challenged it. They won.

What the rule would have done:

• Required total price disclosure upfront (minus tax/tags)

• Banned meaningless add-ons (oil changes for EVs, duplicate warranties)

• Required express consent for all add-on products

• Would have saved consumers $3.4 billion annually, according to FTC

The catch: Just because the CARS Rule is dead doesn’t mean the FTC stops enforcing. They can (and will) still go after dealers for deceptive practices using other legal avenues. State attorneys general are ramping up enforcement too.

👉 Read more

Takeaway:

Don’t celebrate too hard. The FTC and state AGs are watching. Run clean deals. Document consent. Don’t get cute with fees.

NEW PLAYERS

Flai Raises $4.5M for AI Voice Agents

Another YC-backed startup just raised $4.5 million to build AI phone systems for dealerships. Flai joins Toma ($17M raised), Numa, and legacy IVR companies all fighting for the same dealership phone lines.

What makes Flai different (according to them):

They built their voice tech from scratch instead of using off-the-shelf models. They claim it sounds more natural.

Why this matters:

The AI voice market is getting crowded. More competition means better tech and lower prices. But it also means more vendors pitching you the same thing with different branding.

👉 Read more

Takeaway:

Don’t buy the first pitch. Make vendors compete. Test the tech yourself. Record calls and listen to how AI actually handles objections before you commit.

THE BOTTOM LINE

The fight for control is getting louder.

CDK is getting sued for holding dealer data hostage. The FTC lost their CARS Rule but won’t stop enforcing. And AI voice vendors are flooding the market.

Got a vendor pulling games? A tool actually working? Hit reply. I’ll feature it next week.

— Adam