Judge Approves Settlement in Subaru Suit

Subaru groundbreaking ceremony in Camden, Dec. 9, 2015

CAMDEN – Subaru of America could put new engines in vehicles under an agreement to resolve a class-action lawsuit against the Cherry Hill firm.

A federal judge gave final approval Wednesday to settlement of the suit, which contends some Subaru vehicles were subject to excessive oil consumption.

The suit, filed in July 2014, also alleged Subaru was “unresponsive” to customer complaints and set “an unreasonably high threshold” for oil-consumption testing, according to a ruling by U.S. District Judge Jerome Simandle in Camden.

The agreement covers vehicles built between 2011 and 2015 for the Forester, Impreza, Crosstrek, Legacy and Outback models. More than 665,000 people owned or leased vehicles in those categories, according to the suit.

Under the settlement, Subaru denies wrongdoing. The company asserts its vehicles were “properly designed, manufactured, distributed, advertised, warranted and sold.”

The firm also contends “more than 98 percent of the settlement class vehicles have not experienced, and will not experience, any oil consumption concerns,” according to Simandle’s decision.

But the ruling said Subaru had agreed to install a “redesigned” engine, worth about $4,000, “and other countermeasures” in some vehicles found to have oil-burning issues.

“One would expect the oil defect rate to become negligible and the prospect of a second (engine) replacement to be very small,” Simandle said.

The settlement also offers free oil-consumption testing and reimbursement for past expenses, including “certain repairs and replacements of engine components,” the ruling said. It extends warranty protection for problems related to excessive oil consumption.

The settlement, which does not have an overall price tag, “is secured by Subaru’s financial strength,” Simandle added.

He noted the carmaker must file quarterly reports on claims made by its customers.

Simandle, who gave preliminary approval in January, said the settlement was “fair, reasonable and adequate.”

He said the response from Subaru owners “has been strongly positive,” with only 34 people – “a trace amount” — filing formal objections. The judge noted 2,328 people had opted out of the settlement, but said that represented just 0.35 percent of the overall group.

He rejected arguments that the settlement did not address a possible loss in value for affected Subarus, saying the vehicles could command a higher price with a new engine.

The settlement also calls for Subaru to pay up to $1.5 million to attorneys who sued the auto company. It provides $3,500 for each of nine people who were named as plaintiffs.

Jim Walsh; (856) 486-2646; [email protected]

Source: www.courierpostonline.com www.courierpostonline.com

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