August 28, 2024
6th Circ. Rejects General Motors Appeal of Lower Court’s Certification of 26 State Classes Who Claim General Motors Was Aware of Transmission Defects and Safety Risks
6th Circ. Concurs with Lower Court’s Rejection of Key GM Arguments About Consumer Fraud and Arbitration
DETROIT, Mich. – Today, the U.S. Court of Appeals for the Sixth Circuit affirmed a class certification granted on March 20, 2023 in a massive class action lawsuit across 26 states against General Motors (GM) that alleges the car manufacturer violated state consumer protection statutes by knowingly putting cars with faulty transmissions on the road, endangering drivers, passengers, and pedestrians.
The certified class is composed of more than 800,000 owners of GM vehicles with one of two models of eight-speed automatic transmissions, the GM 8L90 or 8L45, which were manufactured between 2015 and March 1, 2019. Plaintiffs claim that the vehicles suffer from shuddering or shaking in higher gears and hesitation, lurching, or jerking in lower gears. Some drivers reported the gear shifting as so violent that it feels as if they were hit by another vehicle. Internal company documents obtained in litigation show that even GM had determined the “startling effect” of the harsh shifts can create a safety issue.
The Sixth Circuit concurred with the lower court’s determination that “[t]he predominant elements of claims for consumer fraud . . . are consistent across all jurisdictions,” namely “(1) proof of intentional concealment or deception by the defendant concerning its knowledge of the alleged defects, and (2) the significance of the information withheld to a reasonable consumer.”
“We are very pleased the 6th Circuit affirmed Judge Lawson’s very thoughtful and thorough class certification order. As the evidence shows, GM has known for years about these transmission defects yet did nothing to tell its customers. Instead, GM went as far as to direct dealers to tell the customers that harsh shifts were ‘normal or ‘characteristic,’” said Ted Leopold, a partner at Cohen Milstein and court-appointed Sole Lead Counsel for the class. “GM’s conduct is highly irresponsible and a breach of the consumers’ trust. We look forward to holding GM accountable before a Michigan jury.”
In its appeal, GM also argued that absent class members were bound by arbitration agreements in addressing any alleged defective transmissions and that the lower court did not consider these agreements in evaluating predominance. However, in certifying the class action, the court determined that GM had waived its right to compel arbitration. The Sixth Circuit concurred with the lower court, stating “it is notable that that GM did not raise an arbitration issue in its initial motion to dismiss, filed on June 14, 2019, nor in its motion to dismiss the [consolidated complaint], filed on November 29, 2019. Instead, GM engaged in over two years of litigation after it filed both motions to dismiss.”
“GM never had any arbitration agreements with its customers and was trying to highjack agreements between dealers and customers to avoid a class action. GM could have tried this tactic with the named Plaintiffs, but didn’t.” stated Doug McNamara, a partner at Cohen Milstein. “We will continue to protect these consumers who purchased defective vehicles worth less than they paid.”
On April 17, 2024, Cohen Milstein filed another case in the Eastern District of Michigan on behalf of consumers in ten additional states regarding the 8L transmission defects. Ulrich, et al. v. General Motors, et al., No. 2:24-cv-11007.
The affected vehicles in the Speerly and Ulrich cases include Cadillac Escalade (2015 – 2016), Chevrolet Corvette (2015), Chevrolet Camaro (2016 – 2017), Chevrolet Silverado (2015 – 2017), Chevrolet Colorado (2017 – 2018), CMC Sierra (2015 – 2017), GMC Yukon Denali (2015 – 2017), and GMC Canyon (2017 – 2018) with one of two models of eight-speed automatic transmissions, the GM 8L90 or 8L45.
Access case documents and read more about Speerly, et al, v. General Motors, LLC (E.D. Mich.).
The plaintiffs are also represented by Theodore J. Leopold, Doug McNamara, Karina Puttieva, and Madelyn Petersen of Cohen Milstein Sellers & Toll, Russell D. Paul of Berger Montague PC, Melissa L. Yeates of Kessler Topaz Meltzer & Check LLP, Tarek Zohdy of Capstone Law APC, E. Powell Miller of The Miller Law Firm, Steven Calamusa of Gordon & Partners PA and Gretchen Freeman Cappio of Keller Rohrback L.L. P.
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Cohen Milstein Sellers & Toll PLLC, a premier U.S. plaintiffs’ law firm, with over 100 attorneys across eight offices, champions the causes of real people – workers, consumers, small business owners, investors, and whistleblowers – working to deliver corporate reforms and fair markets for the common good.
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