Chrysler 2.7 Liter V6 Engine Class Action Lawsuits Consolidated

The United States Judicial Panel on Multidistrict Litigation has issued an order which will transfer all Chrysler engine class action lawsuits pending in various federal district courts throughout the United States to the District of New Jersey for coordinated handling during pretrial proceedings in an MDL, or multidistrict litigation.

There are currently five class action lawsuits pending against Chrysler over their 2.7 liter engines used in several models of Chrysler and Dodge vehicles between 1998 and at least 2003. The Chrysler lawsuits allege that defective designs make the engines prone to form oil sludge, which could causes the engine to fail much earlier than would normally be expected.

A growing number of complaints have been filed by owners of Chrylser Sebring, Chysler Concord, Dodge Intrepid and Dodge Stratus vehicles with the smaller 2.7 liter engine, which have been found to fail around 50,000 to 60,000 miles, but in some cases as early as 20,000 miles.

This type of catastrophic engine failure would not typically be expected anytime before a vehicle reaches 100,000 miles, yet Chrysler has been denying engine warranty coverage since the problems are caused by a build up of oil sludge.

According to the Center for Auto Safety, at least 2,800 reports of Chrysler engine failure involving oil sludge in the 2.7 liter engines were received as of early 2007. Since that time, as the vehicles age, owners continue to report the engine problems.

Chrysler and Dodge engine failure class action lawsuits are currently pending in the Eastern District of California, Middle District of Florida, Northern District of Illinois, District of New Jersey and Southern District of New Jersey on behalf of vehicle owners in those states. In addition, other class action lawsuits and individual lawsuits could be filed in other districts.

The Judicial Panel on Multidistrict Litigation found that the Chrysler engine lawsuits involve common questions of fact and that centralization would serve the convenience of the parties and witnesses and promote the just and efficient conduct of the litigation.

Chrysler’s lawyers opposed the consolidation, arguing that the proposed classes do not overlap and that agreements can be reached between the parties in the lawsuits to minimize any overlapping discovery or risk of inconsistent rulings without the formation of an MDL. However, the Panel rejected these arguments.

“These actions are nearly identical in terms of the facts alleged, and discovery undoubtedly will overlap,” wrote Chairman of the Panel on Multidistrict Litigation, John G. Heyburn, II, in an order issued February 10, 2009. “Centralization will enable one judge to streamline pretrial proceedings and make consistent rulings on discovery disputes, dispositive motions and issues relating to experts.”

The MDL panel decided to transfer all of the Chrysler engine lawsuits to the District of New Jersey, as the action in that Court has been pending longer than the other actions. The litigation will be assigned to U.S. District Judge Faith S. Hochberg for coordinated and consolidated pretrial proceedings.

Since the litigation involves putative statewide class actions for residents of five different states, the MDL panel did indicate that in the future, Judge Hochberg can suggest that the Panel consider remanding the actions to the original courts where they were filed for class certification considerations if that becomes necessary.