Automakers Provide Assistance to Owners of Hyundai and Kia Vehicles Equipped with Theta II GDI Engines

ORANGE COUNTY, Calif. Oct. 10, 2019 – Hyundai Motor America and Kia Motors America have entered into an agreement to resolve class action litigation with owners of certain vehicles equipped with Theta II gasoline direct injection (GDI) engines. This agreement will provide various cash compensation options, lifetime warranties, free inspection and repair of the covered engines, and installation of a software update Hyundai and Kia introduced after the case was filed to enhance safety and address this engine’s performance. It also provides additional remedies to address engine concerns and assist customers with these vehicles.

Vehicles in the settlement include 2.3 million Hyundai (2011-2019 Sonata, 2013-2018 Santa Fe Sport, 2019 Santa Fe, and 2014, 2015, 2018, and 2019 Tucson) and 1.8 million Kia (2011-2019 model year Sportage, Sorento and Optima) vehicles with 2.0-liter and 2.4-liter GDI engines.

Terms of the settlement include:

Cash reimbursement for certain past repairs and related expenses, such as towing and rental cars;

Cash compensation for certain past trade-ins, sales, and in lieu of certain repairs;

Free inspection and repair or replacement of damaged engines;

Lifetime warranty coverage for short block assembly repairs for original and subsequent owners;

Free installation of the knock sensor detection system software update;

Various goodwill compensation for customers inconvenienced by previous lengthy engine repair times, denied warranty coverage, and vehicle loss of value, among other provisions



“Reflecting our commitment to customer satisfaction, Hyundai is pleased to resolve this class action litigation,” said Jerry Flannery, chief legal officer, Hyundai Motor America. “This settlement acknowledges our sincere willingness to take care of customers impacted by issues with this engine’s performance and recognizes the many actions we are already taking to assist our customers.”

“As the latest demonstration of Kia’s commitment to vehicle quality and customer satisfaction, this resolution is the result of good-faith efforts among all parties to resolve owner concerns,” said John Yoon, executive vice president and general counsel, Kia Motors America.

“This settlement is a tremendous outcome for the settlement class and provides significant relief and reimbursements to Hyundai and Kia customers,” said Matthew Schelkopf of Sauder Schelkopf LLC.

“This settlement will put money in the pockets of car owners and lessors and increase safety and reliability,” stated Adam Gonnelli of The Sultzer Law Group P.C.

“This is a win for consumers and we look forward to presenting the settlement to the court and getting funds distributed to class members,” added Steve Berman of Hagens Berman Sobol Shapiro LLP.

The Court is expected to review the proposed settlement for preliminary approval in October 2019. Assuming preliminary approval is granted, notices will be sent to individual class members pursuant to the terms of the settlement.

These class action lawsuits are In re: Hyundai and Kia Engine Litigation, Case No. 8:17-cv-00838, and Flaherty v. Hyundai Motor Company, et al., Case No. 18-cv-02223, in the U.S. District Court for the Central District of California. Plaintiffs in these two actions are represented by Matthew D. Schelkopf of Sauder Schelkopf, Adam Gonnelli of The Sultzer Law Group, Bonner Walsh of Walsh PLLC, and Steve Berman of Hagens Berman Sobol Shapiro LLP.

Knock Sensor Detection System Software Update

Each of these vehicles is part of an ongoing product improvement campaign to install an engine monitoring technology called a knock sensor detection system. The technology uses software innovations and leverages existing engine sensors to continuously monitor for symptoms that may precede an engine failure. It is installed free of charge for all vehicles in the settlement by Hyundai and Kia dealers.

The knock sensor detection system software continuously monitors engine vibrations for unusual dynamic patterns that develop as an engine connecting rod bearing wears abnormally in a way that could later cause engine seizure. If vibrations caused by bearing wear start to occur, the malfunction indicator lamp will blink continuously and the vehicle will be placed in a temporary engine protection mode with reduced power and acceleration. In this temporary mode, drivers maintain full control of the vehicle as brakes, steering and safety devices such as airbags remain operational.

The vehicle can continue to be operated for a limited time in engine protection mode to enable the customer to safely drive it to a dealer for inspection and repair, but acceleration will be slower, with a reduced maximum speed of approximately 60 to 65 mph and a limited engine speed of approximately 1,800 to 2,000 rpm. The knock sensor technology has been evaluated by an independent, leading engineering and scientific consulting firm. When tested using a fleet of vehicles specifically prepared to test the knock sensor technology, the knock sensor system successfully detected failing connecting rod bearings and responded with activation of the engine protection mode.

Hyundai Motor America

At Hyundai Motor America, we believe everyone deserves better. From the way we design and build our cars to the way we treat the people who drive them, making things better is at the heart of everything we do. Hyundai’s technology-rich product lineup of cars, SUVs and alternative-powered electric and fuel cell vehicles is backed by Hyundai Assurance—our promise to create a better experience for customers. Hyundai vehicles are sold and serviced through more than 830 dealerships nationwide and nearly half of those sold in the U.S. are built at Hyundai Motor Manufacturing Alabama. Hyundai Motor America is headquartered in Fountain Valley, California, and is a subsidiary of Hyundai Motor Company of Korea. Please visit our media website at www.HyundaiNews.com.

Kia Motors America

Headquartered in Irvine, California, Kia Motors America has been the highest ranked mass market brand in initial quality for five consecutive years according to J.D. Power, and is recognized as one of the 100 Best Global Brands and 50 Best Global Green Brands by Interbrand. Kia serves as the "Official Automotive Partner" of the NBA and offers a complete range of vehicles sold through a network of nearly 800 dealers in the U.S., including cars and SUVs proudly assembled in West Point, Georgia. For media information, including photography, visit www.kiamedia.com.

Sauder Schelkopf LLC

Sauder Schelkopf is a leading national class action law firm that advances the interests of its clients by recovering the money they have lost and obtaining the relief to which they are entitled. The lawyers at Sauder Schelkopf have recovered millions of dollars on behalf of consumers and have earned their reputation as skilled and aggressive veteran litigators. For firm information, visit www.sauderschelkopf.com.

The Sultzer Law Group P.C.

The attorneys at the The Sultzer Law Group have advocated for the rights of consumers and workers, successfully challenging some of the nation’s largest and most powerful corporations for a variety of improper, unfair, and deceptive business and employment practices in a wide range of industries including, the automobile, financial, cosmetic, food, and supplement industries. For firm information visit www.thesultzerlawgroup.com.

Hagens Berman Sobol Shapiro LLP

Hagens Berman Sobol Shapiro LLP is a class-action litigation firm that seeks to protect the rights of consumers, workers, whistleblowers, investors and others. We work to make a positive difference in the lives of those most vulnerable to negligence, fraud and wrongdoing. For firm information, visit www.hbsslaw.com.

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Contacts:

Michael Stewart

Hyundai Motor America

(714) 887-2495

mstewart@hmausa.com

James Hope

Kia Motors America

(949) 468-1875

jhope@kiausa.com

Matthew D. Schelkopf

Sauder Schelkopf LLC

(888) 711-9975

mds@sstriallawyers.com

Adam Gonnelli

The Sultzer Law Group

(845) 483-7100

gonnellia@thesultzerlawgroup.com

Steve W. Berman

Hagens Berman Sobol Shapiro LLP

(206) 623-7292

steve@hbsslaw.com