Automobile Recall

News & Analysis as of

Warranty Issues in 2017

While the jury is out on whether 2017 will be a peak year for new vehicle sales, elevated OEM warranty and recall costs are likely to continue. OEMs, likely will continue to pay the largest share of these expenses, but...more

Not Correctly Reporting Losses: An Internal Controls Failure

A recent Securities and Exchange Commission (SEC) internal controls enforcement action drew my attention. It was not a Foreign Corrupt Practices Act (FCPA) enforcement action but it certainly does have implications for a...more

Lessons Learned and Compliance Trends from the VW and Takata Scandals (Part III of III)

When unraveling a major corporate scandal, especially multi-year schemes involving senior executives, the blame game or lessons learned approach can easily turn into a fruitless exercise. The VA and Takata scandals are...more

Takata – Criminal Airbag Scheme and Innocent Consumer Harm (Part II of III)

In my continuing review of corporate misconduct in the automobile industry, today we examine the Takata Corporation scandal for its airbag scheme. Takata is a manufacturer and supplier of automotive safety equipment. It...more

SEC – GM Settle Internal Controls Action

Effective internal controls are critical to any organization. The Commission has focused on these controls, brining enforcement actions in recent months tied to internal control issues. Its latest case in this area names...more

Case Halted: California Court Denies Class Certification in Ford Defective Steering Case

On December 22, 2016, a federal District Court Judge in the Northern District of California denied certification of three proposed classes of statewide consumers who purchased or leased certain Ford Fusion or Ford Focus...more

Connected Cars: Navigating Top Trends in 2017

Yesterday, the Automotive Industry Team of Foley & Larnder LLP (yes, us), hosted its annual event at the North American International Auto Show in Detroit, MI. Eschewing narrow or small topics, we charged into 2017 by trying...more

Top Legal Issues Facing the Automotive Industry in 2017

Foley’s Automotive Industry Team has prepared this report that examines what the litigation, enforcement, and regulatory landscape will look like in 2017. Inside, you will learn about: - Managing warranty, recall, and...more

Looming Takata Bankruptcy Presents Risk and Uncertainty to Trade Creditors

In the latest sign of the Takata Corporation airbag fall-out, on December 26, 2016 BMW announced that it will recall nearly 200,000 of its cars in China with Takata airbags. Takata and its 19 OEM customers face potential...more

GM Settles Pair of Ignition-Switch Cases, Faces Thousands More in Massive MDL

Plaintiffs in two separate federal bellwether cases against General Motors (GM) have won their claims against the automobile manufacturer and its faulty ignition switches. The settlements involve two women who were seriously...more

Second Circuit Raises a Caution Flag for Sales Free-and-Clear of Claims

The power of a bankruptcy court to authorize the sale of assets “free-and-clear” of liens and any other interests is a powerful tool that is used to realize value from distressed businesses. Indeed, purchasers will...more

General Motors: Protection Granted in Section 363 Sale Orders is Only as Good as the Notice Given

In a recent decision by the U.S. Court of Appeals for the Second Circuit in the General Motors case, the court held certain claimants were not afforded procedural due process with respect to the § 363 sale of General Motor...more

Sad Stories From Recalled Jeep Grand Cherokee

A vehicle flagged for a potentially fatal flaw in April 2016 has been linked to hundreds of needless accidents and injuries and now a death. Actor Anton Yelchin, 27, was killed two months after the automaker issued a recall...more

Buyer Beware: Used Cars Subject to Different Protections Than New Cars

The new highway bill that recently was signed into law seems to have been influenced by the automotive industry because it does not require used-car dealerships to make repairs on vehicles with open recalls, leaving buyers...more

Rental Car Act of 2015 Championed by Grieving Mother

Twelve years have passed since two 20-something sisters died in a rented PT Cruiser that had an open recall for a defective power-steering hose. At the time, the Budgets, Enterprises and Hertzes of the United States were not...more

Takata Exploding Airbag Claims Another Young Life

A Texas teenager, Huma Hanif was killed when the Takata airbag in her Honda Civic exploded as a result of a crash. Since 2011, the Honda Civic has been recalled multiple times. According to the victim’s family, they have...more

New York Reaffirms General Acceptance Standard in Frye for Scientific and Technical Issues

In a recent opinion handed down by New York’s highest state court – the Court of Appeals –Sean R. v. BMW of N. Am., LLC, 2016 N.Y. Slip. Op. 01000 (Feb. 2016) reaffirmed New York’s continued adherence to Frye’s “general...more

Bellwether Trials: What Manufacturers Can Learn from the GM Ignition Claim MDL

As product liability multidistrict litigation becomes more prevalent, it is important for manufacturers to understand how the bellwether trial process works and how to use it to their advantage. The ongoing bellwether trials...more

Old is New: History Repeats Itself

You may recall that in late 2011, we published the article, “Five Persistent Trends Affecting Automobile Dealers.” While the specifics may have changed, many of the trends continue to persist and affect dealers. This is a...more

China Auto Regulatory Trends 2016: New-Energy, Materials Restrictions, Recalls and Emissions Figure Prominently

China has launched or announced a significant number of regulatory initiatives in the automotive sector over the first months of 2016. I have selected a number of regulatory initiatives representing such trends, below, from...more

Court Approves ESI Protocol Permitting Parties to Redact or Withhold Irrelevant Information from Responsive Documents and Document...

In a March 1, 2016 order and opinion, the United States District Court for the Southern District of Florida permitted Defendants to redact or withhold certain irrelevant information from responsive documents and document...more

Auto Manufacturers Continue Airbag Recalls

Every year millions of lives are saved all around the world by the successful deployment of airbags, but when those devices fail, serious injuries occur. In April 2014, Takata, one of the largest manufacturers of airbags in...more

More Auto Recalls Cite Dangerous Airbag Inflators: Ford Recalling Ranger Pickups Due to Injuries from Exploding Airbags

If you are a consumer who has been following auto recall news over the last year or two, you know that the Takata airbag recall has involved thousands of vehicles sold in the 2000s and has left drivers wondering whether their...more

When Mechanical Failure is to Fault

Automobiles have thousands of parts. Each of these parts operate in concert to propel the vehicle down the road. When these parts fail they can make a vehicle unsafe to drive. Brake failures, tire blowouts, malfunctioning...more

On the Road: Safer Rental Cars

A mind boggling number of cars are on the recall list for safety problems – including about 34 million American vehicles for defective Takata airbags alone. Additionally, last year was a record for the National Highway...more

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