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It appeared that settlement talks stalled Monday between Ford and consumers over an alleged mechanical flaw in millions of cars — just the day after news of an agreement had leaked to the media. The embattled car company is fighting allegations that an ignition module defect in cars that were sold between 1983 and 1995 caused vehicles to stall without warning. Retired Alameda County, Calif., Superior Court Judge Michael Ballachey has already ordered a historic recall of 1.7 million vehicles during the bench trial of the two-phase case. Before news of the settlement leaked to the media Sunday, both sides were prepared to begin opening statements before a jury for the damages phase of the suit, which was filed in February 1996. Ford and plaintiffs’ attorneys would not comment on the case because Ballachey ordered them not to talk to the press while settlement talks were in progress. Plaintiffs’ and defense attorneys in Howard v. Ford, 763785-2, appeared in a Hayward courtroom Monday to seek approval for an estimated $1 billion settlement agreement. According to stories in the San Francisco Chronicle and The New York Times, Ford was on the verge of agreeing to replace the ignition modules or reimburse car owners who’d had the modules repaired, which could have cost the Michigan auto maker up to $1 billion. Under the agreement, Jeffrey Fazio of Hancock Rothert & Bunshoft and other plaintiffs’ attorneys could take home $29 million in fees, The New York Times reported. But on Monday, seven attorneys huddled in chambers with Ballachey for an hour while a dozen reporters waited in the audience and a handful of television crews were positioned in the hallway. When the lawyers emerged, Ballachey told the attorneys to come back next Monday. “Where we have had discussions of settlement … [they] are in the critical to delicate stage,” Ballachey said. After the court session, attorneys declined to comment. “It’s a gag order,” Fazio said before leaving court. Plaintiffs’ attorneys not associated with the case said that this type of delay is routine during the final stages of settlement, and parties often need more time to get critical details in writing. Two attorneys questioned the timing of leaks to the media, which created the impression that the case was virtually settled. “There was probably some upset over that,” James Sturdevant said. “I thought it was premature,” said Elizabeth Cabraser, of plaintiffs’ firm Lieff Cabraser Heimann & Bernstein. Usually attorneys try to nail down most of the documentation for the settlement before an announcement is made, she said. Although it seems the end is near for Howard v. Ford, the agreement could be delayed if class members challenge it in court, experts said. After the settlement is finalized, Ballachey will hold a fairness hearing where objections can be raised on behalf of individual class members who feel they are due more money, said J. Gary Gwilliam, an East Bay plaintiffs’ attorney who is a national officer for Trial Lawyers for Public Justice, which has offices in Washington, D.C., and Oakland, Calif. Trial Lawyers represents plaintiffs who want to challenge a settlement. Gwilliam said he did not know whether class members had sought help from the group. Before news of the settlement broke, attorneys were preparing for the retrial of the damages phase of the class action. In 1999, jurors deadlocked after 10 days of deliberations. Opening statements were scheduled for this fall. A completed settlement would be a huge victory for the Hancock firm, which has burned through millions of dollars to pursue the case for the past five years, plaintiffs’ attorneys say. Since many lawyers rely on fee awards to recoup expenses, Hancock made a “huge gamble” financially by taking on Ford, Sturdevant said. The San Francisco lawyer has tried many class actions, including a pending gender discrimination case against California’s Lawrence Livermore National Laboratory. “If you create a $1 billion benefit, $29 million is a small fraction of that,” Strudevant said.

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