Judge Rejects Motion to Dismiss GM Emissions Cheating Class Action

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Earlier this week, a Michigan federal judge denied a bid by General Motors LLC, Robert Bosch GMBH and Robert Bosch LLC to dismiss a class action lawsuit alleging GM vehicles included devices designed to cheat emissions tests, finding the plaintiffs sufficiently argued that the defendants engaged in a conspiracy.

GM and the Bosch defendants filed the motion to dismiss the emissions cheating scandal class action lawsuit in October 2017, arguing that the allegations were “impermissibly vague” and that the plaintiffs lacked standing.

They also argued that the Clean Air Act preempted the plaintiffs’ claims under state law and that they failed to allege an actionable injury under the Racketeer Influenced and Corrupt Organizations Act (RICO).

U.S. District Judge Thomas L. Ludington found that the plaintiffs’ argument that they overpaid for a “clean diesel” vehicle that emitted far more pollution than advertised satisfies the GM class action lawsuit’s state law and RICO claims.

“Plaintiffs contend that they ‘paid a premium of nearly $9,000, as GM charged more for its Duramax engine than a comparable gas car,’” Judge Ludington wrote in the order. “Plaintiffs thus identify a specific payment attributable directly to the vehicle component at issue which they opted to purchase on the basis of fraudulent conduct.”

“This is cognizable out-of-pocket injury,” according to the judge’s order.

The GM emissions cheating class action lawsuit was filed by plaintiff Andrei Fenner and others in May 2017. The class action lawsuit was subsequently consolidated with another similar class action lawsuit that was pending before U.S. District Judge George Caram Steeh, and the combined cases are titled In re: Duramax Diesel Litigation. The plaintiffs claim that GM marketed its Chevy Silverado and GMC Sierra vehicles with Duramax diesel engines as having “great power” while providing a “whopping reduction” in emissions.

However, the plaintiffs claim that the devices used in these GM vehicles are similar to the “defeat devices” designed to cheat emissions testing in Volkswagen and Fiat Chrysler vehicles. They allege that GM’s vehicles have emissions levels that fail U.S. Environmental Protection Agency standards.

According to the GM emissions cheating class action lawsuit, GM did not act alone in developing the emissions cheating technology to help their vehicles maintain higher market power and fuel efficiency while being able to pass the emissions certification tests.

The plaintiffs claim that the Bosch defendants “were active and knowing participants in the scheme to evade U.S. emissions requirements” and that they helped to develop, manufacture and test components of the emissions defeat device.

“In other words, plaintiffs overpaid for their vehicles because Bosch worked closely with GM to install working defeat devices,” Judge Ludington wrote in the order.

The judge rejected the defendants’ request to put the GM emissions cheating class action lawsuit on hold while the U.S. Environmental Protection Agency completes its investigation into the issue, finding that the case is a consumer protection action and does not allege that the vehicles fail to comply with EPA regulations.

“Accordingly, the factual questions raised by plaintiffs’ suit are only tangentially within the EPA’s specialty,” Judge Ludington wrote. “Because the EPA has no regulatory responsibility regarding defendants’ disclosures to consumers, there is no risk of regulatory inconsistency.”

The plaintiffs are represented by Steve W. Berman and Jessica Thompson of Hagens Berman Sobol Shapiro LLP.

The GM Emissions Cheating Class Action Lawsuit is Fenner, et al. v. General Motors LLC, et al., Case No. 2:17-cv-11661, in the U.S. District Court for the Eastern District of Michigan.

UPDATE: On Aug. 1, 2018, more than a dozen claims were trimmed from a GM emissions cheating class action lawsuit that looks to hold the car maker accountable for allegedly using defeat devices to trick emissions testing in its Silverado and Sierra vehicles.