The Federal Trade Commission’s much-reviled and dreaded car-shopping rule was struck down in court Monday in a decision that came as a surprise to many auto retailers who considered the regulation a foregone conclusion.

The split U.S. appellate court ruling siding with the national and Texas automobile dealer associations will likely stand since the FTC is now under the regulatory-light Trump administration, which isn’t expected to appeal it.

The 2-1 decision hinged on a technicality, that the commission failed to give advance notice of rule-making for the proposal.

The rule, which originally was scheduled to take effect last July, was designed to add clarity to the car shopping and buying experience for consumers by prohibiting bait-and-switch practices, outlawing nonbeneficial add-ons, and getting buyers’ express, informed consent before charging them. 

Auto industry legal experts argued that the practices it aimed to eliminate were already illegal, but most believed the regulation would survive the court challenge, even if only in a watered-down form.

The CARS Rule, short for Combating Auto Retail Scams, would have imposed what the auto industry considered onerous, expensive documentation and other requirements and brought large fines for failure to comply.

The National Automobile Dealers Association, which sued the FTC over the rule along with the Texas Automobile Dealers Association, celebrated the court win just days after its annual industry show concluded in New Orleans, calling it “a victory for the rule of law and a great outcome for consumers.”

NADA President and CEO Mike Stanton called the rule “rushed, poorly researched, and unnecessary” and said it “would have added massive amounts of time, complexity, paperwork and cost to the car-buying and car-shopping experience for virtually every customer.”

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