Ford Explorer Settlement gets Court Approval

posted on:
January 10, 2008

author:
Staff

A state court judge in California has tentatively accepted the settlement of class action lawsuits on behalf of about 800,000 Ford Explorer owners whose vehicles lost value because of their perceived rollover danger. The settlement ends lawsuits against Ford Motor Co. in California, Connecticut, Illinois and Texas. But all personal injury and wrongful death claims involving the Explorer are excluded from the settlement and will continue.

Under the settlement, folks who bought the sport utility vehicles from model years 1991 through 2001 will be eligible for $500 vouchers to buy new Explorers or $300 vouchers to buy other Ford or Lincoln Mercury products. The vouchers can be transferred to anyone in the same state as the original vehicle owner. Ford, which admits no wrongdoing, will also be required to limit the safety claims in its advertising, and the company will pay as much as $25 million in costs and attorneys’ fees. The judge found the settlement to be in the best interest of all the parties. The plaintiffs alleged Ford falsely advertised the vehicles as safe when the company knew they had a tendency to flip and roll over. Ford still contends the Explorers from that era were the safest compact SUVs on the road. But, if that’s true, why would Ford enter into this settlement?

The consumer protection lawsuits filed on behalf of Ford Explorer owners came after more than 250 people were killed and hundreds more injured in accidents involving tread separation on Bridgestone/Firestone Inc. tires. Most of these tires were on Explorers at the time they failed. The tire manufacturer claimed the Explorer’s design was faulty, while Ford put the blame on the tires. Lawyers for the vehicle owners, led by Tab Turner, argued the SUVs lost about $1,000 in value because of the perceived danger and bad publicity. They wanted Ford to pay as much as $2 billion of its profits from the Explorer.

Notices will be mailed to vehicle owners, and a Web site and toll-free telephone number with more information about the settlement will be set up. The judge is expected to give his final approval to the settlement in April.

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