A federal judge restarted a class action alleging that Mercedes-Benz, like Volkswagen, installed software in its BlueTec clean diesel vehicles to cheat emissions tests.
In a Feb. 1 order, U.S. District Judge Jose Linares of the District of New Jersey refused to dismiss most of the claims in the case, including those brought under the U.S. Racketeer Influenced and Corrupt Organizations Act against Mercedes-Benz and Bosch GmbH, which made the emissions software. Linares had dismissed most of the claims in 2016 on standing grounds, concluding that plaintiffs had failed to allege that Mercedes’ conduct caused their injuries. Mercedes-Benz had tried to use many of the same arguments to dismiss the case again, but Linares, in his new order, cited recent rulings in other emissions class actions involving Volkswagen, General Motors and Fiat Chrysler Automobiles.
“The existing diesel emissions litigation decisions squarely reject these arguments and distinguish the cases relied upon by Mercedes and Bosch,” Linares wrote in upholding the RICO claims. “Here, as in Volkswagen, FCA, and Duramax, plaintiffs allege that defendants participated in a scheme to place a defeat device in the polluting vehicles, rendering them defective from the moment they were manufactured.”
Plaintiffs’ lead counsel, James Cecchi and Steve Berman, praised the decision.
“We are pleased with the Court’s ruling, which prevents Mercedes-Benz and Bosch from avoiding responsibility for cheating its customers as well as the environment,” wrote Cecchi, of Carella, Byrne, Cecchi, Olstein, Brody & Agnello, in Roseland, New Jersey, and Berman, of Seattle’s Hagens Berman Sobol Shapiro. “Consumers who thought they had purchased eco-friendly diesel cars were in fact driving polluting vehicles that spew dangerous nitrous oxide up to 91 times federal and state emission standards. Judge Linares’s order allows us to continue holding Mercedes-Benz and Bosch accountable for deceiving U.S. customers and regulators.”
Linares, however, dismissed some consumer fraud claims.
“We believe that these claims are without merit, and we are pleased that the Court recognized the deficiencies in some of plaintiffs’ claims. We intend to continue vigorously defending against the remaining claims,” wrote Andrea Berg, a spokeswoman for Mercedes-Benz parent company Daimler AG. “The court’s decision on Friday merely addressed certain legal aspects of plaintiffs’ claims and did not decide whether the plaintiffs can ultimately prove their claims, whether the plaintiffs’ allegations are true, or whether their claims have merit.”
Bosch spokeswoman Alissa Cleland declined to comment beyond stating in an email: “Bosch is cooperating with the continuing investigations in various jurisdictions, and will continue to defend its interests in the litigation.”
The Justice Department, the U.S. Environmental Protection Agency and other regulators are investigating Daimler over emissions claims.
The Department of Justice already has reached deals with Volkswagen and Fiat Chrysler. Volkswagen’s deal included a $14.7 billion agreement with its customers in 2016. Chrysler’s $800 million agreement last month, in which Bosch contributed, also resolved consumer class actions brought over its “EcoDiesel” vehicles. Bosch also agreed last month to pay $98 million to resolve investigations by attorneys general in 49 states and U.S. territories, including the District of Columbia, over the Fiat Chrysler and Volkswagen scandals.
Plaintiffs attorneys suing Mercedes-Benz drew parallels to rulings in emissions cases involving other automakers, which they flagged in letters to the court.
In his order, Linares cited a March 16 ruling in the Fiat Chrysler case by U.S. District Judge Edward Chen and an Oct. 3 ruling by U.S. District Judge Charles Breyer in a class action brought on behalf of Volkswagen consumers who sold or terminated their leases before the emissions scandal broke. Both judges, in the Northern District of California, refused to dismiss certain RICO claims.
Linares also cited dismissal orders in emissions cases against General Motors, primarily a 2017 ruling in a class action over the 2014 Chevrolet Cruze Diesel, and last year’s Feb. 20 decision refusing to dismiss RICO claims in a class action over GM’s Duramax Diesel trucks. U.S. District Judge Thomas Ludington in the Eastern District of Michigan issued both those rulings.
Plaintiffs are suing Mercedes-Benz for out-of-pocket losses, such as repairs and fuel costs, plus the diminished value of the vehicles.