Four automakers have prevailed in their bid to keep a Pennsylvania lemon law firm from receiving attorney fees for representing 17 car buyers who settled their auto complaints out of court.
The ruling denying the fees came from a three-judge Pennsylvania appeals court panel last month.
In the 17 cases, Nissan North America, Volkswagen Group of America, Toyota Motor Sales U.S.A. and Kia Motors America had replaced or repurchased allegedly defective vehicles through their informal dispute settlement programs, without going through lawsuits. None of the carmakers' programs authorized attorney fees.
Pennsylvania law requires consumers to attempt to resolve lemon law claims through such informal procedures before they can sue.
The clients had assigned their right to attorney fees to the Kimmel & Silverman law firm in Ambler, Pa.
The firm's Web site says: "We have helped more than 75,000 consumers, successfully obtaining more new vehicles and refunds for our clients than any other lemon law firm in the Northeast." It handles cases in 14 states, as far west as Wyoming, and in Washington, D.C.
"Our lemon law lawyers are ready to handle every detail of your case with minimal participation on your end and at absolutely no cost to you," its Web site says.
The automakers went to court to block the firm's bid for attorney fees. A lower court judge ruled against Kimmel & Silverman.
On appeal, the firm unsuccessfully argued that consumers often need lawyers for the informal proceedings because "an unrepresented consumer will be far outmatched by the manufacturer." It also said that "representation throughout the proceedings is necessary because the calculation of amounts due for a repurchase under the lemon law is sometimes complex."
In a unanimous decision written by Senior Judge Eugene Strassburger III, the Pennsylvania Superior Court panel held that the state lemon and unfair trade practices laws and the federal Magnuson-Moss Warranty Act don't authorize attorney fees for disputes resolved through such automaker programs.
While such programs are not binding -- "meaning that a purchaser is free to accept or reject the terms of the settlement as he or she wishes -- a plain reading of the law indicates that acceptance of a settlement is intended to be a final resolution of the lemon law claim," the court said.
The court said all 17 clients were "made whole" by accepting the settlements and awards, leaving no lemon law rights to assign to the law firm.
In a statement, Kimmel & Silverman attorney Robert Rapkin said: "We are obviously disappointed with the decision. However, our firm will continue to zealously advocate for consumers' rights in all aspects of litigation, including the Better Business Bureau Auto Line program and the National Center for Dispute Settlement under the fee-shifting provisions of the consumer protection laws."
Rapkin said he does not know whether there will be a further appeal.
David Ziemba, an attorney in Philadelphia for Toyota and Kia; and a Nissan spokesman said they could not comment on the decision.