This consumer class action arises from defective Theta II engines found in hundreds of thousands of Hyundai and Kia vehicles in the United States.
As alleged, the Theta II engine’s fuel injection system causes contaminants to enter the engine’s oil supply. Initial symptoms of the Defect include a knocking noise from the engine, a reduction in engine power, and engine stalling events (the “Defect”). When the level of contaminants in the oil supply sufficiently thicken the Theta II engine’s oil supply, the engine fails, leading to an immediate loss of engine power and power steering. The Defect thus creates a safety hazard for not only the vehicle’s occupants but the occupants of nearby vehicles. Countless consumer complaints to Hyundai, Kia and traffic safety authorities detail the safety risks and economic burdens of vehicles prone to total and unexpected engine failure.
The only remedy for the Defect is replacing the engine with another defective Theta II engine. Though the Defect is covered by Defendants’ written 10-year, 100,000 mile powertrain warranties, Defendants routinely deny warranty coverage to engines consumed by the Defect by blaming the engine-killing oil sludge on inadequate maintenance or the use of aftermarket oil filters.
Between 2015 and 2017, Defendants recalled 1.5 million vehicles with Theta II engines in North America. Each recall addressed knocking noises, engine stalls, and sudden engine failures. Though the recalls cover Theta II engines manufactured over a five-year period in at least two continents, in each instance, Defendants attributed the recall to the same underlying cause: leftover metal debris in the engine from the manufacturing process.
Reports suggest that in 2016, a Hyundai engineer informed the National Highway Traffic Safety Administration (“NHTSA”) that Defendants have long been aware that the Theta II engines possess a design flaw affecting all Theta II engines. These reports are consistent with the experience of Plaintiff and countless other owners and lessees of vehicles with defective Theta II engines that have not been recalled (the “Class Vehicles”). Non-recalled Theta II engines are failing because of the Defect in numbers that in some cases exceed the failure rates of recalled vehicles.
This case seeks protection and relief for owners of the Class Vehicles for the harm they have suffered, and the safety risks they face, from Defendants’ unfair, unlawful, and deceptive trade practices.