Md. Court Reinstates Class Action on Purely Economic, Not Physical, Injury

March 5, 2007

A potentially far-reaching ruling by the Maryland Court of Appeals reinstates a class action suit against several U.S. automakers even though the plaintiffs were not injured by allegedly defective seat-backs.

Plaintiffs claim seats that collapse backward in rear-impact collisions have killed or seriously injured thousands of people across the country, although none of those filing suit have been injured. The suit was filed by nine Maryland consumers who owned cars made between 1990 and 1999 by General Motors Corp., DaimlerChrysler, Ford Motor Co. or Saturn.

The state’s highest court ruled that the potential for death or serious injury was so great that the owners could sue under a purely economic loss theory.

Attorneys said the case could have far-reaching ramifications, although to date, few states have gone as far as Maryland.

“You have to start somewhere,” plaintiff attorney Jack M. Mason told The (Baltimore) Daily Record. Allowing consumers to sue for economic loss from an “uncrashworthy” defect, he said, “represents the same kind of breakthrough the lawyers had in the ’60s, where they persuaded the courts that the manufacturer had a duty to make the automobile crashworthy in the first place.”

Added plaintiff attorney Bill Askinazi, “There’s no other state that goes this far in allowing the groundwork now for an action for owners that have not actually yet been physically injured but (who) have been injured under the economic loss rule.”

An attorney for DaimlerChrysler AG, one of the defendants, disagreed.

“We think it’s important because it’s probably the most frivolous theory for a class-action suit that is making its way through the American court system today,” spokesman Michael Palese said.

The plaintiffs claimed negligence, strict liability, breach of implied warranty, negligent failure to disclose, failure to warn, concealment, misrepresentation, fraudulent concealment and unfair or deceptive trade practices.

Similar claims in other states were dismissed. The Montgomery County Circuit Court also dismissed the suit, and was upheld by the Court of Special Appeals.


Information from: The (Baltimore) Daily Record,

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