I bought a van in Early 2006 from them. They suggested to purchase 3rd party anti-rust system for my car valued for $900something dollars at that time. Right now I had the car for 3 years and rust did show up in the car. The $900 rust proof protection has a 10 year warranty. When I came to the dealer he refused to deal with me even though he claimed this was done in-house. He sent me to a dealer who quoted the fix for 3000. The other dealer at 5000 and he refused to have any responsibility for it.

I contacted the insurance company that provides warranty for the rust proof company (3rd party but franchises it to dealerships) and they said that it was mine or my dealerships responsibility to get the car checked every 24 months. I normally come to check my car at the dealership every once in a while and they never recommended or told me about it. So right now the warranty of 10 years is null and i still have rust.

The dealership offered to give me some sort of 1500 dollar bonus for a new car or half the price of the other fix.

This is a brand name dealerships...and I don't know what my options are....on one hand, i didn't read the small fine print, but in the other hand they offer a product in which they don't completely back themselves..just do the job and accept payment for.

What are my options?

1) Can I sue since the fix is over 3000-5000 dollars?
2) Do I take the loss and just take the 1500 dollar gesture?
3) Do I go and pursue another avenue in dealing with this dealer.
Also - the reason I am thinking that a law suite makes sense is that he never checked the car in the first place for rust. Its a 2003 model. I bought it in 2006. Probably there was rust before or minimal, but the rust-proofing didnt do the trick...i wasnt told of anything. Just 10 year warranty and the sheet..