High Profile Objection To Settlement On LEAF Battery Case – “Class Members Are Getting Absolutely Nothing Of Value”
A little over a year ago (September 2012) a class action was started based on unexpected battery deterioration loss on 2011 and 2012 model year Nissan LEAFs. More specifically, it claimed Nissan did not make customer’s fully aware of what could happen to the car’s range if too many miles were driven, or if the battery was charged too frequently to 100%.
In December, there was an agreement to settlement terms that required Nissan to repair or replace batteries that could not hold a set amount of charge.
By July, class counsel (Capstone) moved for preliminary approval of the settlement. At the time Capstone’s “valuation expert” said the new warranty was worth from $38 to $200 million to the 18,500+ members of the action. However (much to LEAF owner’s delight), Nissan had already decided to expand their warranty to cover battery loss for all LEAF owners.
This week the settlement approval hearing was held, and only one objection to the settlement was represented…but it was a very BIG objection, as it came from a very big name – Alex Kozinski, the Chief Judge of the Ninth Circuit Court of Appeals, and 2011 Nissan LEAF owner.
“The proposed settlement is a sham, benefiting only class counsel, named plaintiffs and Nissan. Class members are getting absolutely nothing of value, while having their rights abrogated. The class lawyers will benefit to the tune of $1.9 million; the named Plaintiffs will get $5,000 each (note to InsideEVs readers – there is two of them); and Nissan will reap waivers from 18,000+ class members whose product-defect and related claims will be barred by the proposed settlement.” – said Kozinski in his objection
The heart of his objection is that Mr. Kozinski feels that Nissan has essentially offered nothing to those in the class action that everyone else has already received as part of Nissan’s expanded warranty program that covers 9 (of 12) bars of battery capacity; while insuring that those 2011-2012 owners in the class action no longer have future recourse against the company.
“This is doubtless a great deal for Nissan, which manages to buy itself peace, just as certain of the defects with the Nissan LEAF battery are becoming apparent to consumers. And it’s easy money for the Plaintiff’s Counsel, who have clearly placed their interests above those of the class to whom they owe fiduciary duties. With respect this court should not allow it.”
Basically, Mr. Kozinski has taken both Nissan and the Plaintiff’s Counsel to task, insinuating that there was no chance for a fair process and determination to be sussed out.
He further argues that the settlement is worthless, and that there is no doubt to him that Nissan would still honor the current warranty that is in place for all new LEAF buyers today, regardless of purchase date and therefore the settlement has no value and that those who have not opted out of the class action actually have lost their rights in the deal.
“What then is the class getting then in result of the settlement? What are the benefits that class members would lose if they opt out? The answer, of course, is nothing. The only thing that will happen to class members if the settlement is approved is that they will lose rights — the rights they have to sue Nissan under the various theories outlined in the complaint. And of course, class counsel will receive their fat fees for provided zero benefit to the class.”
Mr. Kozinski sums up what relief his objection is looking for on the 3rd page of the court documents filed October 15th:
“As more fully detailed below, we urge the court to reject this bogus “settlement;” reject Capstone as class counsel and commence a process for selecting new class counsel; and appoint a Special Master to determine whether counsel should be sanctioned for their lack of candor to the court and betrayal of the class.”
Basically, the Chief Judge is really not at all pleased with the class action results; and as a noted figure, a person of means who knows his way around the system, is a real threat to the approval of the settlement.
Persons interested can check out the colorful, 58 page “Objection to the Class Settlement” here. Nissan’s response to the objection (filed November 13th) can be found here (Reuters via MyNissanLeaf) – but it isn’t nearly as entertaining. (Hat tip to David R)