A federal judge has denied Hyundai and Kia's $200 million settlement agreement in a multidistrict class action against the automakers following a car theft frenzy that targeted certain model years, ruling that the amount is not enough for some owners.
The settlement had offered different awards based on the severity of financial loss, and it was reached by Hyundai and Kia as well as lawyers representing plaintiffs who claimed their vehicles are too easy to steal because they lack engine immobilizers, a crucial anti-theft device.
About 9 million Hyundai and Kia vehicles spanning the 2011-2022 model years use a physical key instead of a push-button start system and do not have the capability to prevent the engine from starting without a key fob present. Last summer, videos on social media demonstrated how to easily hot wire the vehicles, sparking a nationwide crime spree.
Following the rampant spike in car theft, lawsuits against the automakers began popping up around the U.S., urging Hyundai and Kia to issue a recall and retroactively install immobilizers on the long list of targeted models.
Last September, the lawsuits were consolidated into a multidistrict litigation case in the Central District of California. The case now represents 79 lawsuits spanning more than 24 district courts.
The $200 million settlement proposed to award owners whose cars were stolen and never recovered or completely totaled — the most severe category — up to $6,125. Owners whose cars were damaged or who lost personal property during an attempted theft would be eligible to receive up to $3,375.
According to court documents, U.S. District Judge James Selna ruled that those amounts were not satisfactory because vehicles built in 2011 would be worth less than those manufactured in 2022, which could be worth "substantially more."
Hyundai spokesman Ira Gabriel said in a statement that both Hyundai and Kia are working to "clarify and revise" that aspect of the settlement, and they plan to "renew the motion for preliminary approval of [the] revised settlement agreement in the next 2 to 3 weeks."