Carvana lawsuits have piled up since 2021 across three main fronts: state enforcement actions over delayed titles and registrations, a federal securities fraud class action brought by pension funds, and consumer and employment class actions. Several are still active in 2026, others have ended in settlements and fines, and one strand — the title and registration failures — connects almost all of them.
The Title and Registration Problem Behind Most of the Cases
The recurring complaint against Carvana is straightforward. After selling a car, the company repeatedly failed to deliver permanent titles and registrations within the timeframes state law requires. Buyers reported waiting months, and sometimes more than a year, while Carvana issued temporary tags — often from states other than where the buyer lived — and then replaced those with more temporary tags when they expired.1NBC Chicago. Judge Gives Carvana Green Light to Sell Cars in Illinois Ahead of Late August Hearing That left customers driving on questionable paperwork, exposed to traffic stops and fines, and in some cases unable to prove ownership to their own lenders.2WECT. After 10 Months, Man Still Hasn’t Received His Car’s Registration After Buying From Carvana
By late 2021 Carvana had been fined or investigated in California, Texas, Michigan, North Carolina, and Florida, among others.3News4Jax. I-Team Investigates Car Dealer Facing Fines in Multiple States Including Florida Texas assessed $10,500 in paperwork fines. Michigan placed the company on probation after Carvana admitted violating title transfer and registration laws.4The Wall Street Journal. Carvana Faces Government Scrutiny and Fines Following Consumer Complaints Florida’s Department of Highway Safety and Motor Vehicles fined Carvana over a dozen customers who never got their titles inside the required 30-day window.
State Settlements and Suspensions That May Cover You
Connecticut: $1.5 Million and a Restitution Fund
If you bought a used vehicle from Carvana in Connecticut, this one directly affects you. On January 14, 2025, Attorney General William Tong announced a $1.5 million settlement after a three-year investigation prompted by hundreds of complaints about delayed titles and registrations, late loan payoffs on trade-ins, misrepresented vehicle conditions, and poor customer service.5Connecticut Office of the Attorney General. Attorney General Tong Announces Settlement With Carvana Following Hundreds of Consumer Complaints
$1 million of the settlement funds restitution for Connecticut buyers who purchased from Carvana after January 1, 2019, and incurred fines or expenses related to delayed paperwork or vehicle misrepresentation. The other $500,000 went to the state as a civil penalty, half of it suspended if Carvana complies.5Connecticut Office of the Attorney General. Attorney General Tong Announces Settlement With Carvana Following Hundreds of Consumer Complaints The deal also bars Carvana from selling cars in Connecticut without providing valid title and registration documents at the time of sale.6NBC Connecticut. Connecticut’s $1.5 Million Dollar Carvana Settlement A Hartford Superior Court judge approved the settlement later that month.7Law360. Carvana’s $1.5M Deal to End Conn. Consumer Suit Approved A Carvana spokesperson called the underlying issues “pandemic-era paperwork slowdowns.”8WFSB. Did You Buy a Car From Carvana? Money Could Be Coming Your Way
Illinois: License Suspension, Then Settlement
Illinois was the first state to suspend Carvana’s dealer license, doing so in May 2022 after the Secretary of State’s office received more than 300 complaints about missing titles and misuse of temporary plates.1NBC Chicago. Judge Gives Carvana Green Light to Sell Cars in Illinois Ahead of Late August Hearing Carvana fought the suspension in court and won a temporary restraining order letting sales resume under conditions.
The dispute ended in a January 2023 settlement. Carvana admitted violating Illinois law by failing to issue titles within the required 20 days and by illegally issuing out-of-state temporary registrations to replace expiring Illinois ones.9Fox 32 Chicago. Carvana, State Settle Fight Over Vehicle Titles, Registrations The company forfeited a $250,000 bond earmarked to help affected customers recover losses, agreed to extra inspections by the Secretary of State Police, and consented to additional dealer training.10Repairer Driven News. Illinois Reaches Settlement Agreement With Carvana, Operations Allowed to Continue The Secretary of State kept the authority to suspend or revoke the license again if new problems surface.11WAND-TV. Secretary of State Executes Settlement Agreement With Carvana
North Carolina: 180-Day Sales Ban
North Carolina’s DMV suspended Carvana’s Raleigh dealer license for 180 days, effective August 2, 2021, through January 29, 2022, after finding the company had failed to deliver titles, sold vehicles without state inspections, and issued out-of-state temporary tags to state residents. The civil penalty was small — $500, plus a $200 hearing fee — but the operational conditions were not: Carvana had to audit sales across all four of its North Carolina dealerships, stop issuing out-of-state temporary tags to residents, and ensure every vehicle got a North Carolina state inspection before delivery.12CBS 17. Settlement for Carvana The Charlotte location was placed on probation.13Spectrum News. N.C. Car Dealership Sues Carvana, Says Online Dealer Doesn’t Follow the Rules
The Consumer Class Action and Carvana’s Arbitration Clause
In December 2021, a proposed class action, Jennings et al. v. Carvana, LLC (No. 2:21-cv-05400), was filed in Pennsylvania on behalf of buyers east of the Mississippi River who were promised permanent registration in the preceding two years and were left waiting with temporary tags.14ClassAction.org. Carvana Hit With Class Action Over Alleged Months and Months of Delays in Transferring Vehicle Titles The suit alleged violations of the Pennsylvania Unfair Trade Practices and Consumer Protection Law.
Carvana tried to push the case into arbitration. A federal judge refused.15Barron’s. Carvana Class Action Lawsuit Ruling The Third Circuit affirmed in March 2024, ruling Carvana’s arbitration agreements unenforceable in Pennsylvania because the arbitration clause sat in a document separate from the retail installment sales contract, which itself contained an integration clause declaring it the “complete and exclusive” agreement. Pennsylvania’s Motor Vehicle Sales Finance Act does not allow the separate document to survive.
If you bought from Carvana, the arbitration clause is worth knowing about. The company requires buyers to sign it as a standalone document alongside the main purchase contract, and if enforced it generally blocks you from suing in court or joining class actions. Buyers reportedly have 30 days from signing to opt out by sending Carvana written notice. The Third Circuit’s ruling that the clause is unenforceable turned on Pennsylvania’s one-document rule and does not automatically apply elsewhere.
Securities Fraud Class Action (Still Active)
Carvana’s title and registration problems became the basis of a federal securities fraud case. In August 2022, investors sued, and the consolidated action is now In re Carvana Co. Securities Litigation (No. 2:22-cv-02126, D. Ariz.), covering a class period from May 6, 2020, through June 24, 2022.16CourtListener. In Re Carvana Co. Securities Litigation
Lead plaintiffs the United Association National Pension Fund and the Saskatchewan Healthcare Employees’ Pension Plan sued Carvana founder Ernest Garcia III, other executives and directors, and underwriters Citigroup and J.P. Morgan Securities. The complaint alleges Carvana concealed systemic failures in vehicle documentation, title processing, and registration, including selling cars without possessing legal titles, and that operational problems were serious enough to require an internal “undriveable-car task force” to work through registration backlogs.17Courthouse News Service. Pension Fund v. Carvana, Complaint Plaintiffs also allege the company failed to disclose regulatory actions in Arizona, Illinois, Pennsylvania, Michigan, and North Carolina.
The court denied Carvana’s motion to dismiss. On February 3, 2025, Judge Michael T. Liburdi denied the company’s motion for reconsideration, and the case moved toward discovery.16CourtListener. In Re Carvana Co. Securities Litigation As of mid-2026 it remains active. Discovery fights involve a 2019 SEC investigation into Carvana’s loan securitization disclosures and a more recent SEC inquiry prompted by a short-seller report alleging accounting manipulation and related-party transactions between Carvana and DriveTime, the company founded by Ernest Garcia II, the father of Carvana’s founder.18Courthouse News Service. Plaintiffs Question Father-Son Relationship in Carvana Stock Inflation Class Action Plaintiffs allege Garcia III artificially inflated stock prices, letting his father profit from $3.6 billion in insider sales.
Other Active Cases
TCPA Text Message Class Action
In January 2024, Cribier v. Carvana, LLC (No. 3:24-cv-00094) was filed in the Southern District of California, alleging Carvana violated the Telephone Consumer Protection Act by sending unsolicited marketing texts to consumers on the National Do Not Call Registry or who had previously replied “Stop.” The plaintiff is seeking $500 per violation and $1,500 per knowing or willful violation.19ClassAction.org. Carvana Facing Class Action Over Allegedly Unsolicited Promotional Texts The case was in progress as of early 2026.
Ohio Security Guard Wage Suit
In March 2024, a security guard filed a collective action, Gardner v. Carvana, Inc. (No. 1:24-cv-00458, N.D. Ohio), alleging Fair Labor Standards Act violations for unpaid work during lunch breaks. The complaint says guards were required to stay on site and respond to security threats during those breaks, pushing their hours past 40 per week without overtime.20ClassAction.org. Lawsuit Alleges Carvana Failed to Pay Security Guards in Ohio for Off-the-Clock Work It seeks to represent current and former Carvana security guards across Ohio.
North Carolina Dealer Suit
In November 2022, Mountaineer Motors of Lenoir sued Carvana in the Western District of North Carolina (Mountaineer Motors of Lenoir, LLC v. Carvana, LLC, No. 5:2022cv00171), alleging unfair and deceptive trade practices tied to advertising in areas where Carvana lacked a licensed dealership and to noncompliance with state inspection, temporary tag, and title delivery rules.13Spectrum News. N.C. Car Dealership Sues Carvana, Says Online Dealer Doesn’t Follow the Rules In October 2023, a federal judge ruled that state regulations preempted some claims, trimming the case.21Law360. Carvana Ducks N.C. Dealership’s Claims of Dodgy Biz Dealings
Vehicle Condition and Warranty Complaints
Beyond the courthouse, complaints about vehicle condition keep coming. As of mid-2026, the Better Business Bureau listed 4,959 complaints against Carvana over the previous three years, with service and repair issues the largest category at 3,347.22Better Business Bureau. Carvana LLC BBB Complaints Recurring themes: allegations that Carvana’s advertised “150-point inspection” missed serious problems including brake failures, engine oil leaks, transmission issues, and undisclosed prior accident damage. Buyers also report that warranty partner SilverRock frequently denies repair claims by classifying defective components as “wearable items” not covered by the warranty.23Better Business Bureau. Carvana LLC BBB Complaints
A common pattern: a buyer spots a defect within or near Carvana’s seven-day return window, but the diagnosis and repair-referral process eats up the deadline. At that point Carvana declines the return and directs the customer to SilverRock for warranty service.
Why All at Once
The wave of legal trouble tracked a period of severe financial stress. Carvana had expanded aggressively during the pandemic-era used-car boom and by 2023 carried roughly $5.7 billion in debt. In July 2023 it announced a transaction support agreement to restructure, aiming to cut total borrowing by more than $1.2 billion and near-term cash interest expense by more than $430 million per year.24Carvana Investor Relations. Carvana Announces Transaction Support Agreement The exchange closed in September 2023 with more than 96 percent of existing senior unsecured noteholders participating, and Carvana avoided bankruptcy.25White & Case. White & Case Advises Ad Hoc Group of Carvana Creditors on Successful $5.7 Billion Debt Exchange The distress period overlapped directly with the understaffed title-processing operations and overwhelmed customer service that produced the complaints and enforcement actions above.