— A Jeep corrosion warranty class action lawsuit has been dismissed, but the judge left the door open for the plaintiffs to modify and refile their peeling paint lawsuit.
In addition, the judge ruled the plaintiffs could refile previously dismissed claims from the Jeep corrosion warranty lawsuit.
According to the class action filed in 2021, model year 2018-2021 Jeep Wrangler and 2020-2021 Jeep Gladiator vehicles come with paint and corrosion warranties that are useless to customers.
The Jeep paint reportedly bubbles, flakes, peels, blisters and corrosion and rust will appear. The corrosion warranty lawsuit asserts Fiat Chrysler began using aluminum in the body panels and chassis to reduce weight.
The Jeep corrosion class action also argues Chrysler knew long ago about the problems because dealerships were sent technical service bulletins. Those bulletins informed dealers how to respond to customer complaints and what to do regarding paint and corrosion issues.
The lawsuit says Chrysler issued TSB 31-001-18 in March 2018, and entitled “Aluminum Body Panel Corrosion Repair” for the 2018 Jeep Wrangler. The bulletin concerned “inspecting and if necessary removing corrosion and refinishing the suspect aluminum hood, door, or liftgate panel.”
“Aluminum corrosion along the leading edge of hood or other exterior surface areas of the doors or liftgates. “Remove [the] affected panel” and “[g]rind the corroded areas of the hood to bare aluminum using . . . a grinding disc.” — TSB 31-001-18
That bulletin was later revised to include 2018-2019 Jeep Wrangler “fenders” and FCA also diagnosed the problem as “[a]luminum corrosion along the leading edge of hood or other exterior surface areas of the doors, fenders or liftgates.”
The TSB was again revised for replacement of the affected aluminum panel for “severe pitting exhibited that [could not] be removed with sandpaper” after “removing the initial blistered paint from the panel surface with [the] grinding disc.”
The Jeep corrosion warranty lawsuit further contends TSB 31-002-20 was issued and included the 2020-2021 Jeep Wranglers and 2020-2021 Jeep Gladiators.
According to the class action, the vehicles came with corrosion warranties to provide coverage to “sheet metal panels” for a period of 36 months with no mileage limit. The Jeep corrosion warranty also provided extended warranty coverage of a period of 60 months for corrosion to “an outer-body sheet metal panel,” which FCA defined as “one that is finish-painted and that someone can see when walking around the vehicle.”
But the class action argues it is "widely known throughout the automotive industry that aluminum body panels do not perforate from corrosion, and thus, FCA knew that customers who had purchased the Class Vehicles could never take advantage of the CW to the extent perforation of the panel was a requirement to obtain coverage."
Jeep Corrosion Warranty Lawsuit Dismissed
Judge Matthew F. Leitman previously dismissed all the warranty corrosion class action lawsuit claims except one, for unjust enrichment. But FCA told the judge that unjust enrichment claim must also be dismissed.
FCA argues the owners who sued cannot proceed on those claims, "because an express contract – Plaintiffs’ vehicle warranties govern[s] the parties’ rights and expectations about the vehicles, corrosion, and repairs for corrosion.”
According to the judge, the plaintiffs do not dispute the existence of those warranties, and the owners even admit the warranty “explicitly excludes surface-level and aesthetic-only corrosion, which is the type caused by the Corrosion Defect.”
"That concession is fatal to Plaintiffs’ unjust enrichment claims. Indeed, under well-settled law, Plaintiffs may not recover for the Corrosion Defect on an unjust enrichment theory where the parties expressly agreed that FCA was not warranting their vehicles against that defect." — Judge Leitman
The judge notes the Jeep warranty also includes a specific warranty relating to corrosion and FCA would “cover[] the cost of all parts and labor needed to repair or replace any sheet metal panels that get holes or rust or other corrosion.”
But the judge also found the corrosion warranty also had an important exclusion for “[c]osmetic or surface corrosion.”
This is fatal to the remaining unjust enrichment claim because the plaintiffs admit the damage is “surface-level and aesthetic-only,” and is “not covered by either the [Warranty] or the Corrosion Warranty.”
Although the judge dismissed the entire corrosion lawsuit, he says the plaintiffs may file a motion to refile the Jeep class action where owners can re-assert their omission-based and fraud claims that were previously dismissed.
The Jeep corrosion warranty lawsuit was filed in the U.S. District Court for the Eastern District of Michigan: Orozco, et al., vs. FCA US LLC.
The plaintiffs are represented by Kopelowitz Ostrow Ferguson Weiselberg Gilbert, and Gordon & Partners, P.A.