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Lemon Problems with Jeep & Chrysler ZF 9HP Transmission

A Federal Court is considering approval of a class action settlement involving alleged Transmission Defects in certain Fiat Chrysler Automobiles (FCA) vehicles.  Affected models include 2014 Jeep Cherokee, 2015 Jeep Cherokee, 2015 Jeep Renegade, 2015 Chrysler 200, and 2015 Ram ProMaster City.

The alleged defects include harsh or erratic shifting, clunking, hesitation, banging into gear, malfunction indicator lights, and premature wear or failure of transmission components.

Among other consideration, the settlement proposes to give cash payments or trade-in vouchers according to the following schedule:

  Number of Transmission Related Complaints  

3

4-5

6 or More

  Cash Payment  

$400

$800

$2,000 

  Trade-In Voucher Value  

$1,000

$2,000

$4,000

Depending on the circumstances, however, the same number of complaints could entitle you to all your money back under an individual lemon law claim, even if you no longer own the vehicle.  However, if you do not take specific steps to opt out of the class action, you might only receive a few hundred dollars or a voucher coupon for the same claim.  In fact, if you do not opt out, and you miss a deadline, you might get nothing.   We have seen this happen to prospective clients.  

Our firm has previous experience working on the defense side of lemon law claims, as well as working in-house for a major automaker.  We know how these cases work from every angle. Because our fees are awarded by law, you do not have to pay us for working on your case.  And if you don’t achieve a recovery, we don’t get paid.

If you feel your vehicle may be a lemon, please contact us for a fast, free and confidential evaluation.

UPDATE 11/20/18: It appears the settlement has been approved.   The opt out deadline is January 2, 2018.  For assistance opting out of the settlement, please contact us immediately. 

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Nissan CVT Transmission and Lemon Law

There have been a number of class action lawsuits in Federal Courts which allege Transmission Defects in certain Nissan vehicles equipped with Continuously Variable Transmissions (CVT).  Affected models include certain recent model years of Nissan Sentra, Nissan Altima, Nissan Rogue, Nissan Versa, Nissan Pathfinder, Nissan Juke, Nissan Note, Infiniti JX35, Infiniti QX60, Our law firm has also seen this trend emerge in clients’ individual lemon law claims.

A CVT has a continuous range of gear ratios and is designed to allow the vehicle to shift gears while driving in a smooth way.  Theoretically, this design should reduce or eliminate the “shift shock” felt when a transmission shifts gears.

However, it has been alleged that Nissan’s CVTs experience sudden, unexpected shaking and violent jerking (commonly referred to as ‘juddering’ or ‘shuddering’) and that the vehicles hesitate when trying to accelerate, increasing the risk of injury or death.  Other related concerns include stalling or loss of power, illumination of the check engine light, also known as the Malfunction Indicator Lamp or MIL (association with Diagnostic Trouble Code or DTC P0776), reduced performance due to CVT fluid temperature, and need for Transmission Control Module or TCM reprogramming.  It is further alleged that the Nissan CVT transmission may also wear down or fail prematurely, often just after expiration of the warranty.

If any of the class actions proceed to judgement or settlement, history has shown that class members may might receive compensation such as reimbursed costs, a warranty extension, or a simple cash payment or coupons based on the number of transmission complaints experienced.  

Depending on the circumstances, however, the same number of complaints could entitle you to all your money back under an individual lemon law claim, even if you no longer own the vehicle.  However, if you do not take specific steps to opt out of the class action, you might only receive a few hundred dollars or a voucher coupon for the same claim.  In fact, if you do not opt out, and you miss a deadline, you might get nothing.   We have seen this happen to prospective clients.  

Our firm has previous experience working on the defense side of lemon law claims, as well as working in-house for a major automaker.  We know how these cases work from every angle. Because our fees are awarded by law, you do not have to pay us for working on your case.  And if you don’t achieve a recovery, we don’t get paid.

If you feel your vehicle may be a lemon, please contact us for a fast, free and confidential evaluation.

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Engine Defects in Kia and Hyundai Vehicles

There have been a series of class action suits regarding an engine defect in “Theta II” engines in Kia and Hyundai vehicles.  These suits allege a defect that causes “engine sludge,” or failure of the engine to lubricate itself properly – which can lead to an engine knocking condition, loss of power, stalling, premature engine wear and eventually failure, a fire in the engine, and other problems, such as interference with power steering.  

So far, the list of vehicles alleged to be affected includes the following:

2011 Kia Optima 2011 Kia Sportage 2011 Kia Sorento 2011 Hyundai Sonata 2013 Hyundai Santa Fe
2012 Kia Optima 2012 Kia Sportage 2012 Kia Sorento 2012 Hyundai Sonata 2014 Hyundai Santa Fe
2013 Kia Optima 2013 Kia Sportage 2013 Kia Sorento 2013 Hyundai Sonata 2015 Hyundai Santa Fe
2014 Kia Optima 2014 Kia Sportage 2014 Kia Sorento 2014 Hyundai Sonata 2016 Hyundai Santa Fe
2015 Kia Optima 2015 Kia Sportage 2015 Kia Sorento 2015 Hyundai Sonata
2016 Kia Optima 2016 Kia Sportage 2016 Kia Sorento 2016 Hyundai Sonata

Kia and Hyundai have taken the position that the defect only affects a very small number of vehicles and is caused by a flaw in the manufacturing process that leaves metal debris in the crankshafts.  They have admitted the problem requires engine replacement, but they have continued to blame the “metal debris in manufacturing process” even while claiming the previous problems were fixed by improving the manufacturing process.

 

Our firm has seen examples of these defects, and the effect can be nasty.  Besides the problems with the engines themselves and the questionable recalls, even when performed there is reason to be concerned about dealerships performing widespread engine replacements.  Dealerships are not set up to be factories, and the delays in getting the parts also implicates the Song-Beverly Consumer Warranty Act’s “30-day” rule.  

Remember there are important factors to consider when deciding whether to remain in or opt out of a class action, and that pursuing your own individual lemon law remedy will nearly always be worth substantially more than what you would recover as an unnamed member of a class action.   

Contact us if you have a related problem in your vehicle, or if you would like more information.

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Class Actions and Lemon Law

How do class actions affect lemon law, and vice versa?

Lemon law clients often feel validated when they learn other people had the same problems in the same model vehicle.  This might be a symptom of the frustration of constantly being told them are imagining things by the manufacturer or dealer.  

But how do Lemon Law and class actions affect each other? The answers can be both subtle and dramatic.  

It’s important to remember that in a vacuum, other similar claims have no bearing on your Lemon Law claim.  To prove your claim, you simply need to show that you had a substantial problem that was not repaired within a reasonable number of attempts, or that defeated the essential purpose for which you bought your vehicle.  If you can do that, it doesn’t matter if your vehicle is the only one in the fleet that has the problem, or if all of them do.  

However, what we often see is manufacturers denying problems they know are common in their vehicles on a general basis.  If they know that nearly all their transmissions have a shifting defect, their defense that you must have been imagining it the 4 times you brought it into the shop becomes more suspect.  

In fact, it may rise above the level of incompetence and into willfulness–and that has a big impact on your lemon law claim.  First, it’s harder for them to deny. Second, the denying could lead to awards of civil penalties or punitive damages.

Recalls

Further, if the problem is widespread, the manufacturer should generally know about it before the consumer does, and should issue a recall. (Read more here about the effects of recalls on your lemon law claim.)  If they do not, or if the recall is ineffective, or provides too little too late, there could be cause for a class action.  

If a widespread issue of defects in material and workmanship, it could lead to a class action claim.  But what happens to your lemon law claim if it becomes part of a class action?  

From bad to worse

First, you should know that the class action can take the place of your individual lemon law claim.  If you have not opted out of the class, which usually requires that you take some sort of affirmative step like writing a letter (and keeping a copy of it–because trust us–the manufacturer is more likely to lose track of it), you may be left with whatever settlement or judgement is achieved by the class action suit.  

Second, you should know that if you have a lemon law claim, most likely whatever you would gain under the class action suit will be worth less.  Why is that?  Because with a lemon law case, the threshold remedy is repurchase of the vehicle.  Automotive consumer class actions rarely result in a repurchase. Most often they result in no more than a small amount of cash, or a coupon for a new purchase.  

Third–and it just keeps getting worse–you should know that it’s entirely possible a class action settlement will have a result that gives you nothing in place of the repurchase you might be entitled to under Lemon Law.  That’s right…it’s entirely possible you could get zero under the class action instead of all your money back under the individual lemon law claim.   

Example

For instance Fiat Chrysler recently had a class action settlement regarding modification of a component called the Totally Integrated Power Module (TIPM) in Jeep Grand Cherokee and Dodge Durango models.  The component would fail, causing serious problems such as stalling or failing to start, and a host of other weird issues.  These could easily be lemon law issues–but all the class settlement gave was a recall (which would have been required even without the suit) and compensation for towing, repair and rental charges–which again should be required as a minimum even without the suit.  Finally, the claims period was so short, that may Jeep owners would actually not be provided those reimbursed towing charges until their car actually chose to stall, after the class settlement period. Score one for FCA, which all of a sudden has a legal defense to total lemons.1

Many class action results (usually settlements) have rules for compensation that stretch beyond what the law would require, damages awards which are far less, and perhaps worst of all–short claims periods that may slam shut before you even know you have a claim.  Or even before you’ve experienced any problems!

Feel any differently about class actions now?  You should. And you should also know that in the case of a chronic failure of a product, a weak class action can be a huge benefit to a manufacturer.  This is because it may create a defense to a lemon law claim where one would not otherwise exist.  So beware.

In summary, class actions can both help and hurt your lemon law claim.  Their existence makes it harder to deny the class problem; but class action settlements will usually leave you in a worse spot than you would have been in with your own lemon law claim, and your own attorneys.  

1 It is arguable that lemon law prevents a settlement like this, because it is against public policy and would tend to defeat the branding requirements of the ACNA.  But don’t tell the manufacturers that–to them, the class settlement is a valid excuse to keep lemons on the road and unsuspecting consumers buying them.  

Contact us today if we can answer any other questions about your claim.  

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Lemon Law Buyback Offers: Things to Watch Out For

Issue #1 – the lemon law does not require you to sign a release or settlement agreement.

If Ford, General Motors, FCA, Kia, Hyundai, Toyota, BMW, Mercedes, Tesla or any manufacturer has offered to repurchase or replace your vehicle, there are a few lemon law related issues to keep in mind.

Lemon law requires the manufacturer to repurchase or replace a qualifying vehicle.  It does not require, or authorize the manufacturer to require, a signed settlement agreement or release.  These agreements are often packed with extraneous provisions such as confidentiality clauses and waivers of claims you do not even know you have yet.  

The manufacturer is not complying with the law if it requires you to sign one of these agreements as a condition before receiving your buyback or replacement remedy.  Yet in our experience, manufacturers often state that an agreement must be signed.

Issue #2 – the manufacturer does not get to dictate the mileage offset.

As discussed elsewhere on this site, lemon law provides that for a breach of express warranty claim, the manufacturer may reduce your reimbursement for miles driven before the problems with the vehicle started.  There is a formula in the statute for calculating this “mileage offset.” (See California Civil Code § 1793.2(d)(2)(C).)

One of the most problematic issues we see with manufacturer repurchase or replacement offers is that they make overly aggressive mileage offset calculations. They often try to dictate the offset and fail or even refuse to show how they calculated it.  Sometimes they even cheat by applying the offset to the total odometer miles instead of the miles driven before the first problem, or by applying a lease overmileage calculation instead of using the formula written in the law!

Calculating the mileage offset can be tricky, and it often requires some technical and legal  analysis. For instance, if your car leaked coolant at 10,000 miles, had the water pump replaced at 20,000 miles, overheated at 30,000 miles and required an engine replacement at 40,000 miles, which is the correct mileage offset?  We would probably argue 10,000 miles, because repeat cooling system problems starting there were the root cause of the eventual premature engine failure. We have seen many situations where manufacturer would argue that 40,000 miles should be the offset–and the difference can be thousands of dollars in reimbursement.  

Issue #3 – beware of creative deductions.

We’ve been handling lemon law buybacks for 14 years, yet no two are alike, and we continue to see new and creative methods by manufacturers of deducting from your reimbursement.   There are too many different methods to count them all. The short answer is that the method of determining how to repurchase or replace a vehicle under the lemon law is laid out at California Civil Code Section 1793.2.   The longer answer is that the more creative the deduction, the more you may need an attorney experienced with all of the lemon law case precedent and surrounding regulation to argue against it.    

Issue #4 – the manufacturer is not doing you a favor by buying back your vehicle.

This is a broader issue that actually covers the previous three.  Manufacturers, especially when dealing directly with consumers who do not have attorneys, often act as though a lemon law buyback is some kind of good will gesture. It is not a favor–it’s a legal requirement.   

That means they don’t get to tell you if your vehicle qualifies, they don’t get to dictate your compensation, and quite frankly, they don’t deserve credit or concessions for buying your vehicle back if it’s a lemon.  The law requires them to do so.  You will know excellent customer service when you see it.  If you feel you are being pushed around, just remember that the manufacturer’s customer service department probably has a lot more experience with lemon law than you do.  

The good news is, the California legislature anticipated this issue, and that’s why the lemon law requires the manufacturer to pay your legal fees.  If you want a free second opinion, or are ready to have your own advocate, don’t hesitate to contact us today.

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Lemon Law Issues with 2013 and later Ford Escape

We have seen a variety of problems with 2013 and later model year Ford Escape model vehicles which have lead to lemon law claims.  

Most of these involve problems with the engine and powertrain, including the following:

  • Stalling
  • Losing power while driving
  • Check Engine Light
  • Engine Failure
  • Engine Fire
  • Shuttering or bucking at idle
  • Vibration
  • Overheating
  • Oil and other fluid leaks
  • Replacement of the water pump
  • Loss of Power
  • Cooling System Problems
  • Transmission Problems
  • Transmission slip or jerk
  • Transmission Replacement
  • Transmission failure
  • Transmission stuck in gear
  • Transmission stuck in reverse

 

If you have had any of these problems, contact us for a fast, free and confidential consultation as to whether you may have a claim for compensation under the lemon law.  

 

CVT Transmission in Chevrolet Cruze? Not so fast.

Chevrolet was said to be considering retail distribution of a CVT (“Continuously Variable Transmission”) for the Cruze, but that news appears to be premature.   This may be a good idea. 

We’ve noted here before in these posts that CVTs and as well as other replacements of the traditional hydraulic automatic transmission have been the source of many new lemon law claims the last few years.  

These include the CVT in Nissan models such as the Altima, Sentra, Versa and Rogue.  There was also the class action involving Ford’s DPS6 powershift transmission in Focus and Fiesta models.  We have also had a number of clients report similar problems in Ford Fusion.  

Despite these transmissions’ contribution to lemon law issues, automobile manufacturers relentlessly chase sales volume, and they need these transmissions to meet their CAFE (“Corporate Average Fuel Economy”) standards.  They aren’t likely to go away anytime soon, whether the kinks are worked out or not.  

Stericycle Expert Solutions and Lemon Law

Stericycle Expert Solutions and Lemon Law

If you’ve tried to negotiate a lemon buyback or with a car maker before filing a lawsuit, you may have encountered a company called Stericycle Expert Solutions ( a.k.a. “Stericycle”).

What is Stericycle?

Based on the “About Us” section of its website, Stericycle provides services to businesses in the form of “recall, retrieval, return, and audit processes”. The name “Stericycle” may originate from the company’s history of providing compliance solutions related to medical waste management, but this is only a guess.  

Relative to the automotive sector, Stericycle bills itself as providing the following core services for leading car makers: “reacquisition, recall, early resolution, data cleansing and analytics, funds management and disbursement, and verification and inspections programs”.  

Stericycle News & Lemon Law

Our firm has encountered Stericycle handling the lemon buyback and replacement process for car makers such as BMW, FCA (Dodge, Jeep, Chrysler, Ram), Honda, Kia, Suzuki, Lexus, Toyota, Mazda, Mercedes, Volvo, Porsche, and Mitsubishi.  

It seems that these auto manufacturers and distributors will pass on the negotiation of lemon claims, along with the lemon buyback or replacement process, including the payment to consumers of money and the vehicle turn-in process.  

In most cases, it appears that car makers intend for Stericycle to handle lemon law resolutions before the consumer has brought litigation — and typically before the consumer is represented by an attorney.  This is important Stericycle news to remember for anyone who pursues a lemon law buyback or replacement from a car maker that uses Stericycle’s services.    

Problems We Have Noticed

So, why are automakers passing their lemon law buyback responsibilities to a third party — and a party that is possibly named for medical waste management, no less? We can only speculate, but we have noticed issues that affect consumers.  

Stericycle seems to insulate car makers from the buyback process.  Stericycle can make arguments, demands, or requirements of consumers, while allowing the manufacturer to stand out of the way. We have seen Stericycle misinterpret the law — and, as you might guess, those misinterpretations have always been in favor of the company’s manufacturer clients.  

Perhaps the worst part for most consumers is that the Stericycle middleman process contributes to the delay of resolving a lemon buyback or compensation agreement — a type of stonewalling that manufacturers use to induce consumers to accept less and be done with the frustration.  

Advice for Dealing with Stericycle

Our firm has noticed is that Stericycle is not affable when dealing with consumer lawyers. They apparently like to dish out “compliance” in one direction, without taking any pushback.  

If you are forced to deal with Stericycle in the course of a lemon buyback, and you have any doubts or discomfort about the process, the amount of payment offered, or the length of time it is taking to resolve your situation, contact Goldsmith West for a free review your case. It is always wise to have your own expert advocate, just like the automakers have in Stericycle.  

Lemon Law Issues: Ford Fusion

Lemon Law Issues with 2013 and later Ford Fusion, Ford Fusion Hybrid, and Ford Fusion Energi models

We have seen a variety of problems with 2013 and later model year Ford Fusion model vehicles, including Hybrid and Energi models, which have lead to lemon law claims.  

Most of these involve problems with the engine and powertrain, including the following:

  • Stalling
  • Problems Accelerating
  • Hesitation
  • Wrench Warning Light
  • Engine Fire
  • Check Engine Light
  • Clicking Noises
  • Cooling system problems
  • Oil and other fluid leaks
  • Replacement of the water pump
  • Piston Failure
  • Rough Idle
  • Transmission Failure
  • Transmission Shifting roughly
  • Transmission slipping
  • Harsh downshift
  • Slipping out of Gear
  • Transmission Leaks
  • Throttle Body Problems

We’ve also seen a variety of problems with Ford Fusion Hybrid and Ford Fusion Energi models including:

  • Electrical system problems
  • Premature battery death
  • Fuel Economy Problems (MPG)
  • High Voltage Battery Warranty Problems
  • 12 Volt battery problems

If you have had any of these problems, contact us for a fast, free and confidential consultation as to whether you may have a claim for compensation under the lemon law.  

 

Lemon Law Title Branded Vehicles: The Automotive Consumer Notification Act (ACNA)

reparing

What happens to lemon vehicles after they are legally considered lemons? When the manufacturer takes your vehicle back in a lemon law buyback or replacement, it will generally liquidate the remaining value in the car by selling it at auction.

Does the next owner know the car is a lemon? The answer should be yes. The Automotive Consumer Notification Act (ACNA), found at California Civil Code §1793.23, was added to the California lemon law (a.k.a. the Song Beverly Consumer Warranty Act), requiring the manufacturer taking the car back to permanently inscribe the title as a “lemon law buyback”, making it a lemon law title branded vehicle.

This law also requires the manufacturer to disclose in writing to the subsequent purchaser the nature of the lemon issue, the replairs performed, and that the specific lemon issue is protected by warranty for one year.

The intention of the law is to prevent “lemon laundering”, whereby a lemon vehicle is not lemon law title branded and is passed off to an unsuspecting consumer.

Effect on the Value of the Vehicle

Cars are depreciating assets as it is. A lemon car title is similar to a “salvage title” for a total loss vehicle, though it is not as devastating to the car’s value as a salvage title. Even so, it further reduces the value of your already pre-owned vehicle, even if the manufacturer can repair the lemon defect, because the lemon car title travels with the vehicle for the rest of its life.

The founder of our firm has experience in lemon law title branded vehicles. The loss in value caused by the title brand is not uniform, and it depends on the strength of the market for the vehicle as a preowned car. However, as a rule of thumb, he notes that the loss of actual cash value caused solely by “lemon law buyback” title branding is often in the range of 25%.

So, take away a quarter of the wholesale (i.e., dealer trade-in) value of a vehicle of the same make, model, model year, color, options, and mileage, and you roughly have the value of the lemon as an asset to the manufacturer after completing the buyback.

Also consider that cars depreciate by virtue of time, and that the DMV can take awhile to process branded titles. As another rule of thumb, it’s not uncommon for cars to lose as much as 1-2% of MSRP value per month just by passage of time (though this levels out over time).

When you take this into consideration, the delays in processing a lemon law buyback ultimately make the end result that much more painful for the manufacturer, whether it is because of their own stonewalling or because of title delays.

How does the ACNA affect your lemon law case?

Two factors should be considered: (1) title branding is expensive for manufacturers, and (2) the failure to title brand can be even worse. Regarding the latter, manufacturers are worried about being caught lemon laundering, as they would likely draw unwanted state, if not federal, regulatory attention, as well as fraud and other consumer claims that may indicate punitive damages.

Thus, the ACNA lurks in the background of your lemon law case, and may act both as an impetus for the manufacturer to fight the case and as impetus to settle. A skillful lemon law attorney will understand the practical effects of the ACNA and recognize how to use them to craft the best strategy for his or her client.

Contact Us Today

For more information on lemon law title branded vehicles and how the branding process works, contact Goldsmith West today for a free consultation. We look forward to assisting you.