The ongoing litigation over ignition switch issues that resulted in the recall of millions of General Motors vehicles in 2014 took another step forward Wednesday as U.S. District Judge Jesse Furman of the Southern District of New York ruled on a trio of liability issues that extended across as many as 47 local jurisdictions.
Furman’s decision, coming after the fifth amended consolidated complaint in the action, addressed the application of prior motion to dismiss opinions on the issues of unjust enrichment, incidental damages, and manifest defect in dozens of states that had not been subject to the rulings.
Specifically, the court sought to address whether manifest defect is required for economic loss recovery under 27 states’ law, lost time recovery was possible under the same in 47 states, and whether contract or an adequate legal remedy bars unjust enrichment claims under the laws of 10 states.
As Furman noted in the 108-page opinion and order applying to dozens of the consolidated suits, doing so was “no easy task” considering the scope.
The court ultimately found that manifestation is not required in order to bring statutory consumer protection, common-law fraud, and implied warranty claims. In all but a few of the jurisdictions, the plaintiffs can only recover for lost time dealing with the issues if they relate to lost earnings or wages.
In Colorado, New York, Ohio, Utah and Virginia, Furman found the plaintiffs are able to recover lost personal time under those states’ consumer protection statutes. In Oklahoma, the option exists to recover lost personal time for all claims.
Additionally, Furman found that, in those 10 states in dispute, unjust enrichment claims weren’t an option in most if an enforceable contract or an adequate remedy at law was present. In all of the 10 still disputed jurisdictions other than Connecticut, a plaintiff’s unjust enrichment in the alternative claims are possible if the contract is in question. In seven out of these 10 jurisdictions—Connecticut, New Hampshire and Rhode Island being excluded—an adequate remedy at law will nullify a plaintiff’s unjust enrichment claim.
Furman ordered the parties to confer within the next 30 days to settle on a stipulation and proposed order applying the findings to the claims laid out in the fifth amended complaint.
Kirkland & Ellis partner Andrew Bloomer is helping to manage GM’s legal representation in the multidistrict litigation. He didn’t respond to a request for comment.
Hagens Berman Sobol Shapiro name attorney Steve Berman, Lieff Cabraser Heimann & Bernstein name attorney Elizabeth Cabraser, and Hilliard Muñoz Gonzales name attorney Robert Hilliard lead their firms as co-lead counsel status in the litigation.
In a statement, Berman said the plaintiffs were pleased with the judge’s “thorough 108-page decision.” He noted that Furman rejected GM’s argument that the plaintiffs cannot recover for economic loss unless their vehicles had a malfunction.
“We believe that the opinion will be helpful to plaintiffs’ efforts to certify classes and, ultimately, to prevail on the merits,” Berman said. “This is a big win for the plaintiffs, as GM told the court this issue would be critical for either side and the ruling is squarely in plaintiffs’ favor.”