In re Hyundai & KIA GDI Engine Mktg., Sales Practices, & Prods. Liab. Litig.

• Decision Date: 29 July 2019
• Docket Number: MDL No. 2898
• Parties: IN RE: HYUNDAI AND KIA GDI ENGINE MARKETING, SALES PRACTICES, AND PRODUCTS LIABILITY LITIGATION
• Court: Judicial Panel on Multidistrict Litigation

412 F.Supp.3d 1341

IN RE: HYUNDAI AND KIA GDI ENGINE MARKETING, SALES PRACTICES, AND PRODUCTS LIABILITY LITIGATION

MDL No. 2898

United States Judicial Panel on Multidistrict Litigation.

July 29, 2019

ORDER DENYING TRANSFER

LEWIS A. KAPLAN, Acting Chair

Before the Panel:^* Plaintiffs in the Northern District of California Musgrave action move under 28 U.S.C. § 1407 to centralize pretrial proceedings in the actions listed on Schedule A in the Central District of California. This litigation consists of ten putative class actions, seven of which are pending in the Central District of California. The other three actions are pending in the Northern District of California, the Middle District of Florida, and the Western District of Washington. In addition, the parties have informed the Panel of two related actions pending in the Central and Northern Districts of California. All responding parties—plaintiffs in five consolidated actions in the Central District of California, plaintiffs in the Western District of Washington Short action, and defendants—oppose centralization.¹ The Short plaintiffs alternatively support the Central District of California as the transferee district, but request the Panel instruct the transferee court to place Short on a separate track for discovery and pretrial motion practice.

On the basis of the papers filed and the hearing held, we conclude that centralization will not serve the convenience of the parties and witnesses or further the just and efficient conduct of this litigation. These actions share some factual issues arising from allegations that manufacturing or design defects in certain Hyundai and Kia vehicles equipped with gas direct injection (GDI) engines may cause those engines to seize, fail, and potentially catch fire. The eight related actions pending in the Central District of California, though, have all been assigned to the same judge, and five have been consolidated. Only four actions are pending outside the Central District of California, two of which involve notably different factual allegations regarding the alleged defects.² Where only a minimal number of actions are involved, the proponent of centralization bears a heavier burden to demonstrate that centralization is appropriate. See In re Transocean Ltd. Sec. Litig. (No. II) , 753 F. Supp. 2d 1373, 1374 (J.P.M.L. 2010). Movants have not met that burden here.

In addition, the parties in the consolidated actions pending in the Central District of California have informed the Panel that they have reached a settlement-in-principle that will resolve the claims as to vehicles equipped with the Theta II engine, which constitute the majority of vehicles and models at issue in the actions. The parties anticipate moving for preliminary approval of the proposed class settlement shortly. Movants argue that centralization is necessary to protect the interests of the class members with respect to the proposed settlement. Movants, though, may file objections in the Central District of California if and when the parties there move for court approval of the proposed class settlement. See In re Wells Fargo Fraudulent Account Opening Litig. , 282 F. Supp. 3d 1360, 1361 (J.P.M.L. 2017) (denying centralization, in part, because the parties would have the opportunity to object to the adequacy of the proposed settlement).³ Centralization at this time is premature and could delay the class-wide settlement with little or no benefit to the parties or putative class members. See In re Patriot Nat'l, Inc., Sec. Litig. , 349 F. Supp. 3d 1379, 1380 (J.P.M.L. 2018) (declining to centralize actions where a settlement-in-principle had been reached).

IT IS THEREFORE ORDERED that the motion for centralization of these actions is denied.

SCHEDULE A

MDL No. 2898 — IN RE: HYUNDAI AND KIA GDI ENGINE MARKETING, SALES PRACTICES, AND PRODUCTS LIABILITY LITIGATION

Central District of California

SMOLEK v. HYUNDAI MOTOR AMERICA, ET AL., C.A. No. 2:18-05255

IN RE: KIA ENGINE LITIGATION, C.A. No. 8:17-00838

STANCZAK, ET AL. v. KIA MOTORS AMERICA, INC., C.A. No. 8:17-01365

COATS, ET AL. v. HYUNDAI MOTOR COMPANY, LTD., ET AL., C.A. No. 8:17-02208

BROGAN v. HYUNDAI MOTOR AMERICA, ET AL., C.A. No. 8:18-00622

FLAHERTY, ET AL. v. HYUNDAI MOTOR COMPANY, ET AL., C.A. No. 8:18-02223

CHIECO, ET AL. v. KIA MOTORS AMERICA, INC., ET AL., C.A. No. 8:19-00854

Northern District of California

MUSGRAVE, ET AL. v. HYUNDAI MOTOR AMERICA, INC., ET AL., C.A. No. 4:18-07313

Middle District of Florida

ADAMS, ET AL. v. KIA MOTORS AMERICA, INC., ET AL., C.A. No. 6:19-00250

Western...