Consumer Advocates Make Headway in Push to Improve Hyundai/Kia MPG Class Action Settlement, says Consumer Watchdog Absent Further Improvements, Settlement Still Not Ready for Preliminary Approval, They Say

SANTA MONICA, Calif., July 24, 2014 /PRNewswire-USNewswire/ -- Consumer Watchdog attorneys representing consumers dissatisfied with the proposed nationwide settlement of a class action against Hyundai and Kia over misrepresenting the fuel economy of their vehicles are continuing their advocacy this morning in federal court in Los Angeles, seeking additional improvements in the settlement. 

The dispute dates back to complaints Consumer Watchdog received in 2011 from consumers who were disappointed that their vehicles were not getting the advertised gas mileage. After writing both the White House and the EPA without response, Consumer Watchdog filed suit against Hyundai for misrepresenting the fuel economy of its vehicles. However, on November 2, 2012, the EPA announced that its investigation of the auto manufacturers determined that the manufacturers' estimates were inflated. Numerous other lawsuits were filed across the country. Shortly thereafter, the defendants – Hyundai and Kia – and two law firms representing plaintiffs announced that they had "settled" the case. Consumer Watchdog attorneys have been pressing for more information on the settlement and better terms since that announcement; over the subsequent 17 months, the parties to the settlement have made some improvements in response. 

On June 26, the U.S. District Court in Los Angeles held a hearing on a request by Hyundai, Kia and law firms representing plaintiffs that the court grant initial approval of the settlement. The court asked the parties to the settlement address a number of issues and concerns, including those presented to the court in a brief by Consumer Watchdog attorneys filed on May 30. However, the response by Hyundai, Kia and the plaintiffs supporting the settlement did not fully address the issues raised by the Court, the Consumer Watchdog lawyers said in a brief filed late last week.

Tomorrow's hearing will address the following issues raised by the Court and Consumer Watchdog attorneys:

  • The format and clarity of the notice and other forms that will be directed to consumers who are part of the class action. Though the settling firms have made some improvements, the documents remain confusing and unlikely to capture the attention of recipients, Consumer Watchdog lawyers said. Additionally, the web-based claim system is not yet fully operational.
  • Whether class members should be required to fill out and file a claim form in order to get the money they are entitled to under the settlement. Consumer Watchdog attorneys say the claim requirement is an unnecessary hurdle.
  • Defendants have failed to provide detailed estimates of the total value of the case and, if a claim form is required, the likely amount of compensation the class will receive under the settlement.

"The Court is carefully reviewing the fine print of the settlement, and insisting on changes. This is good news for people who bought or leased Hyundai or Kia cars based on incorrect representations of the gas mileage that the cars would get," said Laura Antonini, one of the Consumer Watchdog attorneys representing 13 consumers who have asked the Court to reject the settlement unless further changes are made. "We believe our strenuous advocacy on behalf of our clients – and the 900,000 consumers who will be part of the class – has already improved the settlement, but more changes are necessary."

Court review of class action settlements is a two-step process. Courts engage in a preliminary review prior to class members (consumers) receiving notice of their rights under the settlement. At a future time, the court will engage in a final review of the settlement for its overall fairness, considering concerns and objections raised by class members.

Read Consumer Watchdog's initial analysis of the proposed settlement (January 22, 2014): http://www.consumerwatchdog.org/resources/memoresettlement1-30-14.pdf

Read Consumer Watchdog's brief formally opposing preliminary approval of the proposed settlement (May 30, 2014): http://www.consumerwatchdog.org/resources/5-30-14krauth-hasperopposition.pdf

Read Federal District Court Judge George Wu's Tentative Ruling requesting further information and changes in the settlement (June 26, 2014): http://www.consumerwatchdog.org/resources/hyundaitentativeruling.pdf

Read Consumer Watchdog's Response to the Supplemental Brief filed by those in favor of the settlement (July 18, 2014): http://www.consumerwatchdog.org/resources/hyundaicwdsresponse.pdf

Read more about the lawsuit here: http://www.consumerwatchdog.org/case/hyundai-false-advertising-miles-gallon-mpg

The case is In re: Hyundai and Kia Fuel Economy Litigation, C.D. Cal. Case No. 2:13:ml-02424-GW-FFM.

SOURCE Consumer Watchdog



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