The steering of Mr. Peterson’s 2011 Kia Sorento pulled so suddenly and strongly that the vehicle sometimes changed lanes by itself. When he could no longer tolerate the problem — and concluded that Kia would not help — he saw the lemon law as his only chance. “Well, short of a lawsuit how are you going to take on a big company like Kia?” Mr. Peterson said. His complaint resulted in Kia’s having to buy back the vehicle. That recourse might not be possible if the automakers’ efforts are successful. The remedies sought by the McKinneys and by Mr. Peterson took different approaches. In a class action, thousands of consumers can benefit when a product they bought is judged to be defective. In a typical lemon-law case, a lone consumer starts with arbitration, generally choosing among arbitration firms approved under each state’s lemon law. If the outcome is unsatisfactory, there are provisions to appeal, including the courts. But now a few automakers are trying to do away with those resources by taking advantage of something consumers have done for decades when buying a vehicle: signing an agreement with the dealer to use arbitration to resolve disputes. Some automakers — including Honda, Toyota and Mercedes-Benz — are arguing that these sales agreements cover them, too. Consequently, the automakers say, consumers may not use class-actions or lemon laws to get restitution. Instead, they argue, the consumer must use binding arbitration, in which the decision is final. “I think this is a very worrisome issue,” said Christine Hines, the consumer and civil justice counsel at Public Citizen, a nonprofit consumer advocacy group. Arbitration takes consumers out of a public process — the court or state-monitored lemon laws — and puts them in a private system, Ms. Hines said. Moreover, she said, it requires the consumer to play by rules set by the arbitration firm approved by the automaker. Groups of consumers represented by a class-action may be happy to be included even if they receive only a small benefit, but few would devote the time, effort and expense to go into arbitration alone against an automaker, consumer advocates say. “So one of the main benefits from the company’s standpoint is to eliminate claims against the company,” said Jean Sternlight, a law professor at the University of Nevada Las Vegas, who studies arbitration.
Posted on: Mon, 17 Jun 2013 18:07:58 +0000
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