Automotive

While the automobile has long been considered a symbol of personal freedom, it also symbolizes the complicated relationship between Americans and large corporations. As we’ve become reliant on cars, so too has our reliance grown on automakers to produce vehicles that are safe, reliable, and fit for purpose.

But vehicle manufacturers repeatedly cut corners to increase profits at the expense of the driving public. Every year, there are hundreds of recalls affecting tens of millions of vehicles. Often times, the recalls themselves are inadequate and fail to fully compensate drivers.

Milberg’s Automotive Practice Group

Class action lawsuits are among the most powerful tools that owners have to fight back against automakers. Milberg’s Automotive Practice Group attorneys are national leaders in automotive class actions, with the strength, resources, and track record needed to get these cases certified and settled.

Milberg attorneys have filed automotive class action lawsuits against some of the largest car manufacturers in the world—including GM, Hyundai, VW, Subaru, and Nissan—that have resulted in hundreds of millions of dollars and other benefits for vehicle owners.

Unsafe At Any Speed, The Dawn of the NHTSA

The automobile has been integral to the American way of life since its introduction at the turn of the 20^th century. Around 90% of U.S. households own at least one vehicle, and there are nearly 300 million vehicles operating on roads throughout the country.

But our car culture has personal and societal costs, including a cost to personal safety. In his landmark 1965 book Unsafe at Any Speed, Ralph Nader revealed a crisis in vehicle safety due to the auto industry ignoring safety issues. The book resulted in Congressional hearings that led to the creation of the National Highway Traffic Safety Administration (NHTSA).

The NHTSA has the authority to identify safety defects, conduct investigations, and manage safety recalls for vehicles and vehicle equipment. But NHTSA, with an annual budget of less than $250 million for its vehicle safety programs, is tasked with regulating a global automotive industry that brings in trillions of dollars per year. Some of the top automakers have yearly revenues of more than $100 billion.

In the decade after Nader published Unsafe at Any Speed and the NHTSA was established, a scandal involving the Ford Pinto’s exploding gas tanks rocked the automotive world. During litigation, it was revealed that Ford knew about the risk but, using a cost-benefit analysis, determined that it was cheaper to face lawsuits than to fix the problem.

Fast-forward four decades later and we find that automakers still regularly ignore safety and other issues based on a profit-centric model.

Automobile Recalls on the Rise

Although vehicles have gotten significantly safer thanks to innovations—like airbags, antilock brakes, and seatbelts—scandals like deadly Takata airbags and GM ignition switches continue to plague the auto industry. And while major recalls dominate headlines, a litany of less scandalous, but nonetheless serious, vehicle safety issues impact millions of owners annually.

• Approximately 1 in 4 vehicles on U.S. roads has an open recall.
• According to the NHTSA, in 2022 there were 932 vehicle safety recalls affecting more than 30.8 million U.S. vehicles.
• In 2021, NHTSA issued over 1,000 safety recalls involving 35 million vehicles. This was a record number of recall campaigns, which covered issues that included air bags, steering and suspension, tires, restraints, and software and electronics.
• From 2014 to 2021, vehicle recalls increased by 42%.
• NHTSA recalls increased from 602 in 2000 to 1,018 in 2016.

Not all vehicle recalls relate to safety defects, and not all are initiated by the NHTSA. Many are issued by manufacturers because vehicle features do not meet their own quality or performance standards.

Some recalls involve problems that aren’t a threat to safety but create inconveniences. A sunroof that leaks or a seat that doesn’t recline may not pose a safety risk, yet they negatively impact normal vehicle functioning and impose time and cost burdens on owners.

Some attribute the increased number of recalls to enhanced vigilance, both by NHTSA and manufacturers. Today’s vehicles also have more complex technological systems that are prone to glitches. Nonetheless, vehicle owners can, “anticipate a massive growth in recalls with no relief in sight,” according to the President and CEO of Recall Masters.

Auto Recalls and Class Action Lawsuits

When an auto recall is issued, the manufacturer typically offers a repair or replacement at no cost to owners. However, in the eyes of the consumer, a recall is often, at best, a half-measure.

Vehicle models may be excluded from the recall, or the offered solution may be considered inadequate. Owners might feel that the resale value of their car has been permanently diminished, or that they should be reimbursed for out-of-pocket costs like towing, a loaner vehicle, or prior repairs. They may also want stronger assurances from the manufacturer, in the form of an extended or lifetime warranty, about how the issue will be handled in the future should it recur.

There are many reasons why a manufacturer’s recall can fall short of consumer expectations. Individually, there is little an owner can do to demand more, other than pleading their case to the service manager. Since recalls are handled at the highest corporate levels, however, this is unlikely to achieve the desired result.

But consumers are not powerless. They can join together and file a class action lawsuit that forces an automaker to address their claims.

Notable Cases and Recent Recoveries

• Berman v. GM: $42 million settlement to resolve claims that General Motors sold defective, oil-burning engines
• Chess v. VW: Per the settlement terms, owners of a 2010–2011 Audi S4 or S5 with transmission issues were eligible for a reimbursement of $5,000 – $12,000
• Gjonbalaj v. VW: Drivers of certain VW and Audi models with leaking sunroofs received an extended warranty and repair reimbursement in this class action settlement
• GM Cadillac Headlight Settlement: Milberg attorneys negotiated a settlement that allowed owners and lessees of 2010–2015 Cadillac SRXs with moisture-related headlight problems to claim payments for out-of-pocket repair expenses
• Glenn v. Hyundai: Under this settlement, anyone who bought or leased a Hyundai with a panoramic sunroof that shattered was eligible to receive a warranty extension, reimbursement for repairs, rental cars, and towing, and a one-time payment of $600 or $1,000
• Parks v. Subaru: Milberg settled this class action lawsuit on behalf of Subaru owners who claimed that a software error made their batteries drain and fail. Subaru agreed to pay the full cost or half the cost of a battery replacement based on mileage, reimburse customers for battery drain expenses, and provide a free software update
• Sanborn v. Nissan: This class action resolved claims that certain Nissan Altima vehicles had a melting dashboard defect and recovered dashboard replacement costs for Florida owners
• Stedman v. Mazda: In a confidential settlement agreement with Mazda over claims about dashboard defects in 2009–2011 Mazda 3 and Mazda 6 vehicles, the automaker consented to a three-part resolution that included a reimbursement component, a replacement component, and a warranty enhancement

In addition, Milberg is currently working to resolve shattering sunroof claims in Johnson v. Nissan. This class action has been certified but settlement negotiations are ongoing.

Milberg: A National Leader in Class Action Lawsuits

Since 1965, Milberg has filed thousands of class action lawsuits and recovered billions of dollars for our clients.

Our firm pioneered the use of federal class action litigation and remain a national leader in this area. Our attorneys have the necessary knowledge, experience, resources, and historical success to take on large corporations and are consistently named as Class Counsel in lawsuits that provide real benefits to members.

To connect directly with a Milberg Automotive Practice Group attorney, contact us today.