Ford Transmission Class-Action Settlement Declined

The Powershift transmission case settlement that was challenged in court has been for reexamination after the appellate court detected significant contradictions with the package deal being "just" and "appropriate" for consumers. Several owners of cars equipped with defective transmissions, with the assistance of the Public Citizen company specialized in protection of consumers’ rights, expressed the protest against the deal by asserting that the compromise agreement had no true value to the affected party.

The case documents say that the issues in the DCT unit led to jolts and vibrations in Fiesta and Focus during acceleration. Moreover, it is claimed that some drivers had to deal with other problems, which manifested themselves in speed-up delays and downshifting malfunctions. A vast number of lawsuits have been taken to court against the American Auto Giant because of the problematic DCT unit. It was later revealed that the carmaker had known about the gearbox issues already at the stage of testing, but did not take any action.

According to the compromise deal, owners and lessees of affected vehicles with 3 or more visits to dealer centers with the purpose of replacing of some of the main gearbox components could get $200 for the 3-rd service visit, with higher payments on every subsequent visit. But this deal seems unfair for car owners with less than 3 service visits. As an alternative, owners of affected models also may get a discount if the decide to buy another Ford model, instead of settlement compensations. Affected customers with more than 3 transmission software updates carried out in dealerships could receive $50 starting with the 3-rd software update, with an additional $50 for each following update procedure. But at the same time, this does not include customers who had less than 3 software updates.

Last spring, the car manufacturer offered a compromise deal to the owners of particular Ford Fiesta and Focus models equipped with the failure-prone Powershift unit, according to which the settlement was estimated at $35 mln.

Learn more about the class-action settlement denial

Representatives of the complainant challenged the deal because of concerns on the amount of possible compensation to the affected party. The appellate court decision was 2-1. The decision called into question that the legal team did everything in its power to protect interests, but were more interested in approval of the settlement proposal from Ford because of their financial interests. It is claimed that in case of the deal approval, the legal representatives on the case will get $8,856,000 legal fees. Ford, in turn, expressed the opinion that the settlement deal offered to the affected party is a just one.

It should be noted that commonly class action lawsuits have low claim rates, implying that only a slight share of customers is going to initiate a claim. Many Focus/Fiesta owners just disregard this scandalous case because they weren't the claimants from the start. Even lawyers of the affected party say that only fifteen percent of owners would even set up a claim. In truth, only 8% of potential claimants eventually put forward a claim.

The appellate court found some discrepancy in the deal asserting 2 mln Ford customers would be included in the lawsuit, yet the representative of the complainant party said that there were only about ninety-three thousand cars, which meet the requirements. Therefore, only a minor part of the class will be able to get any payments. Currently, the lawsuit is at the state of the case revision.