U.S. court refuses to approve a class-action settlement over defective Audi-Vw sunroofs

Article by Christian Andrei, on June 5, 2012

The 3rd U.S. Circuit Court of Appeals in Philadelphia refused to approve a class certification related to incidents of defective sunroofs on several Volkswagen and Audi models. Last Thursday, this federal appeals court said that it would be improper for these plaintiffs to file a suit together since the accord treated the second owner subgroup differently from the first subgroup.

In addition, it noted that the class representatives came from the first subgroup. Instead, the federal appeals court proposed a solution that would revive the nationwide deal. These suits stem from owners’ claims that the sunroofs of about 3 million vehicles from the 1997 to 2009 model years may enable rainwater to leak inside when they were clogged by plant debris and pollen.

The cases also stated that Volkswagen AG failed to disclose that regular cleaning and maintenance could resolve the problem because doing so would admit a design defect. The vehicles included in this case include: the VW Golf, Jetta, New Beetle, Passat and Touareg, and the Audi A4, A6 and A8. In August 2010, U.S. Magistrate Judge Patty Shwartz in Newark, N.J., certified the owner class and signed a settlement, which gave details about repairs and improved disclosures.

In addition, she formed an $8 million fund that would have reimbursed the repairs of one owner subgroup but forced another subgroup to wait. The deal was valued at $69.3 million and gave the plaintiffs' lawyers the award amounting to $9.2 million in fees.

According to what Judge D. Brooks Smith wrote for a three-judge panel of the 3rd Circuit, there is a “fundamental intra-class conflict.” He wrote further that representative plaintiffs can’t sufficiently represent the interests of the entire class. Smiths submitted the proposal, enabling all the plaintiffs to submit claims for reimbursement, or dividing the plaintiffs into two subclasses that could be certified separately, to resolve the issue.

Topics: audi, vw, united states

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