(Printed in the Journal
of The Alliance of Automotive Service Providers, AASP)
Tired of all the "class action" litigation letters you have been receiving lately? Well, get ready because more are on the way.
I am constantly amazed by the amount of class action lawsuit letters that
I am routinely inundated with on a weekly basis. The most recent involves
Firestone again. In this class action suit against Firestone, a woman suing
Firestone represents all the Plaintiffs. Here I will attempt to summarize
the confusing eight pages of litigation toilet paper I received.
The Plaintiff represents anyone who purchased, leased or owned the Firestone-made
tires at any time between 1991 and 2002. The lawsuit background: In May of
2000 the National Highway and Transportation Safety Administration, (NHTSA),
investigated and subsequently forced recall of certain Firestone tires. During
that recall NHTSA investigated many other types and sizes of Firestone tires
made at that time. After completing their investigation, NHTSA decided not
to recall any of the additional investigated tires. The Plaintiff in this
case is representing a nationwide class of persons who owned Firestone-brand
ATZ, ATX II, Wilderness AT and other tires investigated, by NHTSA.
The Plaintiff claims that Firestone sold the tires without telling consumers
that they contain alleged defects that make them prone to tread separation.
In particular, the Plaintiff claims that the tires are defective because
they lack a design feature called a "nylon cap ply" or "cap strip."
The Plaintiff further claims that had consumers known of the alleged defects,
they would have paid less for the tires than what was actually paid. The
Plaintiff seeks to recover damages from Firestone for herself and the class.
Firestone denies all allegations and believes that the suit is meritless
and that the class does not have damages since the class members used the
tires without incident or problem.
After reading this I can tell you that had visions of dollar signs
dancing in my head. I figured it would be a lot of work, but I knew through
our computer system I could determine how many of those tires we had purchased
over the years. Without even calculating, I started realizing that we would
be in for quite the settlement check. As usual with these class actions,
I was again in for a surprise.
Reading the "Decision to Settle" paragraph proved enlightening:
The lawyers representing Plaintiff and the members of the Class
have made a thorough investigation of the law and facts relating to the lawsuits
pending against Defendants. Those lawyers have reviewed thousands of documents
from Defendants, government agencies, and other public sources, taken numerous
depositions, retained and consulted with experts, and analyzed numerous questions
of law. The parties have engaged in extensive arm's length negotiations,
which resulted in an agreement to settle this litigation as set forth in
the Stipulation of Settlement. In agreeing to the Stipulation, Plaintiff
and Plaintiff's counsel considered the risks of continued litigation and
the likelihood of success, balanced against the substantial benefits to the
Tire Settlement Class as a result of the Settlement. Plaintiff and her lawyers
have concluded that the Settlement is fair, reasonable, and adequate and
in the best interest of the Tire Settlement Class. Defendants have denied
all wrongdoing and any liability to the Plaintiff and the Tire Settlement
Class. Defendants nonetheless have agreed to enter into the Stipulation to
avoid further expense, burden, distraction, and inconvenience of litigation.
My hopes of any cash out of this deal went fading fast after reading that
"purchasers of tires for resale" were exempt from the proposed settlement.
Then again, I didn't miss much. A brief description of the settlement terms
follows:
Firestone Agrees To:
(a) Tire Design and Manufacturing Changes. Firestone has agreed that, for
a period of at least seven years, it will manufacture and sell a specified
group of tire sizes and brands with designs that include cap belts/strips,
nylon belts/strips, or other comparable technology intended to provide equivalent
or better high-speed capability for such tires.
(b) Consumer Education Program. Firestone will conduct a consumer safety
awareness program -- using national media, a web site, point-of-sale materials,
direct mail, and other efforts -- with an annual budget of $5,150,000 and
a term of three years from the time of settlement. This program is to be
submitted to the Court for review and approval and will focus on enhanced
consumer awareness of tire and vehicle safety issues.
In addition, Firestone will get a release of all further litigation from
the class members. Oh well, as typical with these class actions, there is
nothing left for me. Nothing left for the hundreds of thousands of people
in the class that had a vehicle with those tires. One large figure on the
last page of the action caught my eye though. The figure was 19,000,000.
Yes that's 19 million. It is the amount that the Plaintiff's Attorney's
will collect from Firestone. Oh, and the Plaintiff, she gets a
measly 2,500. Well, at least she can buy a decent set of tires and wheels.