Bruce Steckler is representing plaintiffs in a consolidated class of Ford hybrid owners claiming the automaker overstated their vehicles’ fuel economy in advertisements succeeded in hanging on to certain fraud and breach of warranty claims, with a New York federal judge finding those allegations well supported Thursday.
U.S. District Judge Kenneth M. Karas allowed the class’s claims of common-law fraud and breach of express warranty surrounding Ford Motor Co.’s Fusion and C-Max hybrid vehicle ad campaign, which allegedly relied too heavily on an estimated 47-miles-per-gallon estimate provided by the U.S. Environmental Protection Agency.
Claims regarding Ford’s possible exaggerations of the fuel economy in excess of the EPA estimates were also allowed to go forward, according to the order on the automaker’s late-2013 motion to dismiss the suit.
“The court finds that plaintiffs’ other claims, namely those targeting specific ‘additional’ representations that go beyond those EPA estimates, state a claim under state consumer protection law, even under the strict requirements of Rule 9(b),” the order stated. “Plaintiffs have sufficiently distinguished these additional representations from the mere use of EPA estimates in their papers.”
Judge Karas went on to say that the car owners have “sufficiently alleged the who, what, when, where and why of the fraud at issue.”
However, he dismissed claims concerning Ford’s simple use of the fuel economy estimates in advertising for the hybrid cars provided by the EPA, ruling that the fraud allegations were clearly preempted by the Energy Policy and Conservation Act. He also was unconvinced by the allegations that Ford’s use of the 47-miles-per-gallon estimate in ads was misleading, ruling that the plaintiffs failed to state a specific claim upon which relief could be granted or provide an example where Ford did not include a disclaimer regarding the estimate.
Judge Karas also dismissed the class’s Magnuson-Moss Warranty Act claims, agreeing with Ford that its ads did not create an actionable warranty, as well as the claims of unjust enrichment under California and New York law, saying they failed to specify an independent claim.
The instant case had been consolidated in June 2013 from about 17 district court cases against Ford nationwide, including from Arizona, California, Florida, Illinois, Missouri, Nevada, New Hampshire, New Mexico, New York, Pennsylvania and Washington, according to court documents.
The car owners accuse the automaker of conducting an extensive and intentionally misleading ad campaign beginning in 2012 across multiple platforms to promote Ford’s new hybrid vehicles, the Fusion and C-Max, touting their improved fuel economy, namely the cars’ 47 miles per gallon. The automaker even said that a new hybrid vehicle could take a driver on a round trip from Los Angeles to Las Vegas with a single tank of gas, according to court documents.
Members of the consolidated action are all owners or lessors of Fusion or C-Max vehicles claiming that the cars generally get a maximum of 37 miles per gallon or less and that the plaintiffs relied heavily on Ford’s numerous claims of higher fuel economy when choosing to purchase or lease the cars.
The car owners are seeking reimbursement of the sales and leases of the vehicles and have asked that all Ford profits and compensation related to the hybrid cars be disgorged. They car owners are also demanding that Ford cease its false advertising and that they be awarded punitive damages and legal fees, according to court documents.
On Thursday, although Judge Karas also dismissed any individual plaintiff claims that did not cite specific advertisements that were relied upon in making the decision to pay for a Fusion or C-Max, he gave the plaintiffs 30 days to amend the complaint only in regard to specific advertisements.
Counsel for Ford and the plaintiffs could not be reached Thursday for comment.
The plaintiffs are represented by Paul Geller, Stuart Davidson, Mark Dearman and Sheri Coverman ofRobbins Geller Rudman & Dowd LLP, Eric Gibbs, Geoffrey Munroe and David Stein of Girard Gibbs LLP, John A. Yanchunis and Rachel Soffin ofMorgan & Morgan Complex Litigation Group, Richard McCune and Elaine Kusel of McCune Wright LLP, Jonathan Shub and Scott George ofSeeger Weiss LLP, Stephen Jaffe, Mark Fistos and Seth Lehrman ofFarmer Jaffe Weissing Edwards Fistos & Lehrman PL, Bruce Steckler and Mazin Sbaiti of Steckler Law LLP, and Cory Fein of Caddell & Chapman.
Ford is represented by John A. Dewey, Jeffrey Yeatman, Matthew Goldberg and Timothy Birnbaum ofDLA Piper.
The case is In re: Ford Fusion and C-Max Fuel Economy Litigation, case number 7:13-md-02450, in the U.S. District Court for the Southern District of New York.
