Hyundai and Kia must face insurers' lawsuits over vehicle thefts
A US judge rejected bids by Hyundai and Kia to dismiss litigation by several hundred insurers seeking to recoup more than $1bn R18.37bn) they claim to owe drivers whose vehicles were stolen or damaged in a social media-inspired theft spree.
In a decision on Wednesday, US district judge James Selna in Santa Ana, California, rejected arguments that it was unfair to let insurers recover because they had collected premiums and assumed theft risks and did not specifically identify which drivers were victims.
Selna also found sufficient arguments that the lack of antitheft devices on 14.3-million Hyundais and Kias made from 2011 to 2022 made thefts foreseeable, despite the South Korean carmakers' assurances that their cars were safe.
The complaint supports the idea that thefts were a “predictable consequence” of Hyundai's and Kia's actions, he said.
“Though [the insurers] have received premiums, defendants allegedly failed to include any antitheft device as required under federal regulations,” Selna wrote. “Thus, the level of fault is almost entirely on the defendants.”
Hyundai said on Thursday it was disappointed with the decision and looked forward to an eventual dismissal. It said its dealers have installed antitheft software on more than 1-million vehicles.
Kia said it remained confident the plaintiffs' legal claims had no merit and its vehicles complied with federal safety and theft-protection standards.
Both companies said they are working with law enforcement on matters related to the thefts.
Lawyers for the insurers did not respond to requests for comment.
Hyundai and Kia generated criticism and a slew of litigation over their failure to install antitheft devices known as immobilisers on most of their vehicles.
Thefts began to increase in 2021, worsened by TikTok videos showing how to steal cars that lack push-button ignitions and immobilisers in seconds.
On October 31, Selna granted preliminary approval to a class action settlement with Hyundai and Kia covering more than 9-million vehicles. That settlement has been valued at $200m (R3.68bn) with up to $145m (R2.66bn) of the payments going to drivers.
Selna also oversees litigation by municipalities seeking to recoup public safety and other costs tied to vehicle thefts.
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