Week Adjourned: 6.27.14 – Ford, Caterpillar, Kashi

The week’s top class action lawsuits and settlements. Top stories this week include Ford, Caterpillar and Kashi.

Ford 2Top Class Action Lawsuits

It was Ford’s turn this week…its turn to face the class action blues…yessiree—they got hit with a consumer fraud lawsuit alleging personal harm from what appears to be a rather serious design defect.

The Ford lawsuit was filed in Florida by Ford Explorer owners and lessors alleging the automaker mislead consumers about the vehicles’ exhaust system that exposes passengers to dangerous levels of carbon monoxide.

Filed by lead plaintiff Angela Sanchez-Knutson, the complaint alleges that when the air conditioning is on in the Ford Motor Co. sport utility vehicle, the exhaust leaks into the passenger cabin of the cars. This poses a health risk to those in the cars and a safety risk to people on the road.

Sanchez-Knutson further claims that she and her daughter suffer from chronic headaches as a result of exposure to dangerous levels of carbon monoxide in her 2013 Ford Explorer. She alleges she took the car to the local dealership for repair numerous times because of a sulfuric smell. However, at no point in time was she informed that the odor actually signified exposure to the gas.

An internal technical service bulletin distributed by Ford to its dealerships showed that the automaker was aware that certain Explorer models’ exhaust systems were leaking into the cabins of the cars when the air conditioning was turned on, the complaint states.

The bulletin provided dealerships with instructions on how handle the smell in the vehicles but did not specify that carbon monoxide was seeping into the cabins or provide any remedies to protect consumers from the risk of exposure, according to the lawsuit.

“Ford knew or should have known that the 2011 through 2013 model year Ford Explorers were dangerous and defective such that drivers and passengers of those vehicles may be exposed to carbon monoxide and other dangerous gases while the vehicles are in operation,” the complaint states.

The complaint alleges Ford violated the vehicles’ express and limited warranties, since the contracts guaranteed that the vehicles were defect-free. All of the affected vehicles are still under warranty with the company, the lawsuit states.

As a result of filing the lawsuit, the National Highway Traffic Safety Administration announced that it is looking into the exhaust allegations. The agency said it was aware of complaints involving the vehicles but that it had not initiated a formal investigation.

The lawsuit seeks to certify a class of all consumers in Florida who purchased or leased the 2011 to 2013 Explorer models. The suit is Sanchez-Knutson v. Ford Motor Company, case number 0:14-cv-61344, in the U.S. District Court for the Southern District of Florida.

Exhausted yet? Wait–there’s more! Caterpillar Inc. also got hit with a class action lawsuit over claims that its heavy-duty on-highway diesel engines, designed to adhere to 2007 U.S. Environmental Protection Agency (EPA) emissions regulations, contain a design defect that requires extensive repairs and replacements. Nice!! This is all sounding so familiar!

The Caterpillar lawsuit alleges Caterpillar’s 2007-2010 model C-13 and C-15 engines have defective exhaust emission controls which make the vehicles unreliable for transportation. Further, despite repeated repairs, they cannot be permanently fixed.

According to the complaint, the engines’ exhaust emission control systems regularly detect warning and shutdown readings from the software used to regulate and monitor certain components, causing the vehicle to require authorized exhaust emission control diagnoses that eventually are unable to rectify the problem.

“This caused plaintiff and class members to incur significant damages in the diminution of the value of their vehicles, but also in the cost of replacing the … engines with other EPA 2007 Emission Standard compliant heavy-duty, on-highway, diesel engines.” the lawsuit states.

K Double D Inc, lead plaintiff in the class action, alleges it purchased a vehicle featuring the 2007 heavy-duty on-highway diesel engine that suffered engine and regeneration problems, which resulted in thousands of dollars in damages to the company.

Further, K Double D claims that despite extensive repair work, the engine experienced repeated instances of warning lights illuminating, engine derating and shutdown, regeneration failure and more, as well as other failures that prevented it from working properly.

“Despite defendant’s numerous attempts to correct the … failures, the … engine exhaust emission controls do not function as required under all operating conditions, and will not do so for the expected life of the vehicle,” the lawsuit states.

The lead plaintiff seeks to represent a class of all vehicle owners and lessees who purchased or leased a vehicle containing the engines. The lawsuit alleges claims of breach of express and implied warranty, negligence, unfair and deceptive acts and more.

The suit is K Double D Inc. v. Caterpillar Inc., case number 1:14-cv-01760, in the U.S. District Court for the District of Colorado.

Top Settlements

Heads up all you California crunchy granolas!  A settlement has been reached in a consumer fraud class action lawsuit pending against Kashi Co. According to the terms of the settlement, a fund of $5 million will be established by Kashi, which will resolve claims of false advertising, the grounds for the lawsuit.

Ok—so I think we know the tune here—the Kashi lawsuit, Astiana v. Kashi Co., Case No. 3:11-cv-01967-H-BGS, alleged the food manufacturer misled consumers by claiming that certain of its products are “All Natural” and “Nothing Artificial” even though they contained synthetic ingredients, such as pyridoxine, hydrochloride, calcium pantothenate and/or hexane-processed soy ingredients. Got it?

Class Members of the Kashi class action settlement include California residents who purchased certain Kashi products between August 24, 2007 and May 1, 2014.

Ok–Folkswe’re done herehave a great weekend and we’ll see you at the bar!

 

Week Adjourned: 4.19.13 – Kashi, Bankers Life, Bank of America

Hot Class Action Lawsuit News Update: Week Adjourned: 4.19.13 – Kashi, Bankers Life, Bank of America

Kashi CerealTop Class Action Lawsuits

What’s in your cereal? Kashi Co, and parent company Kellogg are facing a class action lawsuit over allegations their cereal is mislabelled, effectively hiding the amount of sugar in the products.

And it’s not just cereal, apparently. According to the Kashi class action lawsuit, dozens of Kashi products are allegedly mislabeled, including cereal, chips, crackers and bars, pasta and frozen entrees.

The lawsuit, entitled Nadine Saubers v. Kashi Co., Case No. 13-cv-00899, U.S. District Court for the Southern District of California, states “Nearly all of Kashi’s products’ labels list ‘evaporated cane juice’ as an ingredient despite the fact that the FDA has specifically warned companies not to use the term because it is ‘false and misleading,’ is not ‘the common or usual name of any type of sweetener,’ and the ingredient is not, in fact, juice.”

Lead plaintiff Nadine Saubers, alleges Kellogg and Kashi are in violation of consumer protection laws which regulate food labeling, specifically by their use of the term “evaporated cane juice” instead of sugar, and by failing to disclose that the ingredient is still considered to be processed sugar. Yes, you have heard this one before …

The Kashi class action lawsuit seeks to represent a proposed class of all US residents who purchased Kashi mislabeled products since October 1, 2009, including a subclass of California purchasers.

Long Term Care Falls Short. Heads up to anyone with elderly parents who have paid into Chicago-based insurance company Bankers Life and Casualty long-term health benefits plans. The insurer is facing a bad faith insurance class action lawsuit alleging the company is denying benefits to those who paid for long term health care insurance so they would have security in their old age.

The Bankers Life class action, alleging elder abuse, was filed on behalf of four individuals (two harmed families) who have made claims as representatives of the class. Hundreds, possibly thousands of elderly customers are estimated to be affected by this action. The Oregon action is similar to other lawsuits against Bankers Life in other states.

Grants Pass resident Dennis Fallow, a plaintiff if the lawsuit, claims his mother has paid their premiums for years, counting on having support if she became ill. “That time came and all she got from Bankers Life was a cold shoulder, rejection and red tape. It was a total rip off,” he said in a statement to the press.

Fallow’s 79-year-old mother, Katherine Fallow, needed an in-home caregiver when she came home in 2009 following multiple hospitalizations. The family hired a caregiver certified as a home health aide by the State of Washington and an Oregon certified home health aide to care for Mrs. Fallow. Dennis Fallow began submitting the bills for that care to Bankers Life, anticipating payment under terms of his mother’s policy. What followed were several months of wrangling over aides’ qualifications, long delays in communications and denials of payments. Bankers Life eventually made payments in the amount of $11,388, far short of the $51,667 the family paid for Mrs. Fallow’s care. Mrs. Fallow died on July 6, 2011.

In 2011, Grants Pass attorney Christopher Cauble filed a lawsuit against Bankers Life on behalf of the Fallows. He soon learned the Grants Pass family wasn’t alone. “Bankers Life has likely refused long term health care benefits to many, many Oregonians,” Cauble told reporters. “I began hearing about other families with experiences similar to that of the Fallows. What we have in Bankers Life is a company with a history of raising premiums, delaying payments and denying legitimate claims.” Cauble’s findings prompted him to join with Portland attorney Mike Williams and his firm to file the federal class action against Bankers Life on behalf of all Oregon consumers.

FYI—in 2011, Bankers Life ranked worst (19th out of 19 companies) in the Oregon Department of Consumer and Business Services’ (DCBS) consumer complaint index. In fact, DCBS figures show Bankers Life ranked worst for consumer complaints every year from 2005 to 2011. Now there’s something to aspire to.

Top Settlements

News in the never-ending saga of mortgage-backed securities—this one was all over the wires this week—Bank of America reached a tentative settlement in the pending securities fraud class action lawsuit brought by investors who purchased mortgage investments from Countrywide Financial. BofA acquired Countrywide in 2008.

The proposed settlement would see BofA pay $500 million to settle the lawsuit, which would be paid out to plaintiffs that include Dubai’s Mashreq Bank and public and union pension funds in California, Maine, Nevada, Vermont and Washington states. The plaintiffs claimed they were misled about the risks of securities they bought from California-based Countrywide between 2005 and 2007.

The settlement surpasses the $315 million accord reached with Merrill Lynch in May 2012, making it the largest to resolve federal class-action litigation over mortgage-backed securities since the financial crisis began. The accord requires court approval.

Ok—that’s a wrap. See you at that bar…