A federal appeals court ruled that General Motors (GM) should face a significant class action lawsuit over claims that it violated the laws of 26 states by knowingly selling vehicles with defective transmissions.
The decision, handed down by the 6th U.S. Circuit Court of Appeals, allows drivers to sue as a group over alleged issues with GM's 8L45 and 8L90 eight-speed automatic transmissions, which were installed in Cadillac, Chevrolet, and GMC vehicles from the 2015 to 2019 model years, Reuters reported.
The plaintiffs in the case claim that these vehicles have severe transmission problems, including shuddering and shaking in higher gears, as well as hesitation and lurching in lower gears, even after multiple repair attempts.
GM has also been accused of instructing its dealers to reassure customers that these harsh shifts were "normal."
Despite GM's argument that most vehicle owners did not experience these issues and therefore should not be part of the lawsuit, the three-judge panel from the Cincinnati-based appeals court ruled that overpaying for allegedly defective vehicles was sufficient grounds for standing.
Circuit Judge Karen Nelson Moore said the specifics of how each plaintiff experienced the transmission problems were irrelevant to the broader claims that GM concealed known defects from buyers.
The ruling is significant as it allows the case to proceed as a class action, potentially involving around 800,000 vehicles, with 514,000 included in the certified classes.
The vehicles in question include popular models such as the Cadillac CTS, CT6, and Escalade; Chevrolet Camaro, Colorado, Corvette, and Silverado; and GMC Canyon, Sierra, and Yukon, among others.
Class actions are often preferred in such cases because they can lead to more substantial recoveries for plaintiffs at a lower cost than individual lawsuits.
The court's decision also rejected GM's argument that many claims should be resolved through arbitration, sending the case back to U.S. District Judge David Lawson in Detroit, who had certified the classes in March 2023.
Ted Leopold, a partner at Cohen Milstein Sellers & Toll and representative for the drivers, expressed confidence in the case.
"We look forward to holding GM accountable before a Michigan jury," he said.
