A federal judge will soon decide the fate of the class-action settlement proposal put forth by Navistar earlier this year that would set up a $135 million fund that offers payouts to owners of certain International trucks.
Judge Joan Gottschall of a U.S. District Court in Illinois is scheduled to hear oral arguments in little over two weeks, Nov. 13, on whether the deal should be approved and finalized. At least four carriers have objected to the settlement agreement, arguing it doesn’t go far enough in compensating owners of Navistar’s MaxxForce engines for lost resale value of their trucks.
The objection, filed Oct. 10 by attorneys representing Ferguson Enterprises, Southern California Edison Co., the Walt Disney Company and U.S. Foods, could derail the settlement, says attorney Jason Lichtman of Lieff, Cabraser, Heimann and Bernstein — the firm representing the class in Navistar’s settlement. Should Gottschall side with the fleets and not approve the settlement, the process would have to start over and parties would need to reach a new settlement deal, says Lichtman.
Navistar announced the agreement in May, noting it had already planned a $159 million charge-out in the second quarter of this year to pay for the settlement. Under the terms of the agreement, those who purchased an International truck equipped with model-year 2011-2014 MaxxForce 11-liter or 13-liter engine was eligible for compensation. That compensation could come via a $2,500 per-truck cash payment, a $10,000 rebate (per truck) on a new International truck or repayment for repair costs up to $15,000 per truck.
MaxxForce owners could also choose to opt out of the settlement and pursue separate litigation against Navistar.
Lichtman says there’s no timeline or limit for when Gottschall must issue a decision after the Nov. 13 oral arguments. However, he says, she could rule as soon as the day of the oral arguments, should she choose.
