Mercedes-Benz Agrees to Settle Engine Defect Class Action Lawsuit

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On March 23, the plaintiffs of an ongoing Mercedes-Benz engine defect class action lawsuit informed a California federal court that they have agreed to an unopposed class action settlement with the automobile manufacturer that will provide monetary relief to engine defect Class Members in form of thousands of dollars in reimbursements for car repairs related to the allegedly defective engine parts.

According to the engine defect class action settlement:

“Defendant Mercedes-Benz USA, LLC (‘MBUSA’) prospectively [will] cover future repairs for the allegedly defective parts at issue for the lesser of 10 years or 125,000 miles, subject to certain conditions and limitations. This extended coverage more than doubles the durational limit of MBUSA’s New Vehicle Limited Warranty’s term of the lesser of 4 years of 50,000 miles.”

Each Mercedes-Benz Class Member will receive varying amounts for future repairs depending on when the engine defects manifests itself from this point forward. Based on the engine defect class action settlement, Class Members should expect the company to pay 100 percent, 70 percent, or 37.5 percent of the reasonable repair cost required by the presence of the engine defect.

Additionally, Mercedes-Benz will reimburse eligible engine defect Class Members for past repair costs that they incurred while attempting to replace the allegedly defective Mercedes-Benz engine. If these car repairs were not performed at an authorized Mercedes-Benz dealer, then participating Class Members will be reimbursed up to $4,000 for these engine defect repair and replacement costs.

The engine defect Class, should it be certified, would include: “All current and former owners and lessees of Mercedes-Benz branded automobiles equipped with certain M272 or M273 engines … who purchased or leased their Subject Vehicles within the United States.” The plaintiffs claim that there are potentially 300,000 Mercedes-Benz vehicles that fall within this Settlement Class definition.

Mercedes-Benz denies  all wrongdoing in this engine defect class action lawsuit, but has agreed to settle in order to avoid the uncertainty and cost of future litigation. This Mercedes-Benz engine defect class action settlement does not have a monetary cap.

This Mercedes-Benz engine defect class action lawsuit was originally filed in 2012 by plaintiffs Majeed Seifi and Tracey Deakin, who allege that certain Mercedes-Benz vehicles were equipped with engines containing defective gears that would wear out prematurely without warning. This alleged engine defect would cause the “check engine” light to turn on and cause the car to misfire or stop driving all together. Repairs for this engine defect typically cost Mercedes-Benz consumers several thousand dollars and required them to go without a car for several days in a row.

The plaintiffs further allege the automobile company knew of the Mercedes-Benz engine defect since 2007, since during that year the company distributed service bulletins to its dealers on how MB technicians should diagnose and replace the allegedly defective engine parts. However, Mercedes-Benz allegedly did not inform consumers of the defect at that time and instead concealed the engine problems.

During the course of the engine defect class action lawsuit, Mercedes attempted to dismiss the suit from court. Though the presiding federal judge would not allow the automaker to duck liability charges, he did trim some warranty claims during the trial. Over the next couple years, the plaintiffs pressed on, and in November of last year, they asked for summary partial judgment against Mercedes-Benz. Soon after this motion by the plaintiffs, both parties entered into mediation sessions to discuss settlement terms.

The plaintiffs are represented by Roy A. Katriel of the Katriel Law Firm and Gary S. Graifman of Kantrowitz Goldhamer & Graifman PC.

The Mercedes-Benz Engine Defect Class Action Lawsuit is Majeed Seifi, et al. v. Mercedes Benz USA LLC, Case No. 3:12-cv-05493, in the U.S. District Court for the Northern District of California.

UPDATE: The Mercedes-Benz engine defect class action settlement was preliminarily approved on April 8, 2015.