Jung v Major Automotive Cos., Inc.
Annotate this CaseDecided on November 5, 2007
Supreme Court, Bronx County
Justin Jung, Individually, and on behalf of All Other Persons Similarly Situated, Plaintiffs,
against
The Major Automotive Companies, Inc., and John Does No.1-10, Jointly and Severally, Defendants.
25668/04
Attorney for Plaintiff:
William C. Rand, Esq.;
Co-Counsel: Jeffrey M. Gottlieb, Esq.
Attorney for Defendant:
Leonardo D'Alessandro, Esq.
Alexander W. Hunter, J.
Upon the foregoing papers, the motion by plaintiff for an order preliminarily approving the class action settlement agreement, preliminarily certifying the plaintiff class, preliminarily appointing Justin Jung as the lead plaintiff and appointing the law office of William Coudert Rand and Jeffrey M. Gottlieb, Esq. as lead counsel for the class, is granted without opposition and with the consent of the defendant.
The complaint in this action alleges, inter alia,that defendant conducted its business in a fraudulent, unfair and deceptive manner in that defendant purchased automobiles that were "wrecked" or "totaled" in prior accidents, had them repaired, and sold them to unsuspecting consumers. The complaint alleges that defendant willfully and purposefully hid the prior [*2]accidents from consumers in an attempt to sell the repaired automobiles at a higher price for a profit.
Plaintiff previously made a motion before this court to certify the class and the motion was reserved pending plaintiff's deposition and further discovery by the parties. Plaintiff and defendant jointly submit the instant motion and annex a copy of a Class Action Settlement Agreement dated August 4, 2007. Defendant has denied any and all liability to plaintiff and the putative class. Nevertheless, the parties engaged in settlement negotiations and plaintiff contends that the parties desire to avoid the expense, delay and risk of continued litigation. Subject to court approval, they have agreed to settle the action pursuant to the provisions in the Settlement Agreement. The parties agree that the Settlement Agreement is fair, reasonable and adequate because it provides substantial benefits to the class and is in the best interest of the class.
Plaintiff, with the consent of the defendant, asserts that the class action for settlement purposes, complies with the requirements of C.P.L.R. Article 9. The parties request that the class be certified for settlement purposes and that the class be defined as "all persons and entities that purchased a used automobile from the Defendant from December 1, 1998 to the Effective Date of Settlement ( Class Period') which had a repair with repair being defined as: the repair or replacement by Defendant of a vehicle's engine, power train, transmission or structural or body damage where the cost of the repair or replacement is in excess of $500.'" (Exhibit C).
Under the terms of the settlement, each class member will receive a certificate entitling the class member to a $250 credit towards the member's purchase of any new or used car purchased from defendant on or before a three year period following the effective date of settlement. In addition, each class member will receive a certificate entitling the class member to a ten percent (10%) discount on the member's purchase of repairs, parts or services (excluding the purchase of a vehicle) from defendant on or before a three year period following the effective date. (Exhibit C). The certificates will be mailed with the class notice.
Furthermore, during the three year period after the effective date, defendant agrees that it shall provide a CarFax report or other such reputable report to every customer who purchases a used vehicle from defendant, at no cost to the customer, and each customer will sign a statement indicating that he or she has received such a report from the defendant.
During the same three year period, defendant agrees that it will provide to every customer who purchases a used vehicle from the defendant, at no cost to the customer, a description of a repair, if one has been performed on the vehicle, and the customer will sign a statement indicating that he or she has been made aware that there has been a repair to the vehicle, prior to the purchase of the vehicle. Moreover, during the three year period after the effective date, defendant agrees that it shall conduct periodic training of its new personnel who deal directly with customers that purchase used vehicles on how to interact with a customer and how to explain a car's maintenance history and any reports such as CarFax reports. [*3]
Defendant will also conduct training of its new personnel who perform emissions tests and will make any employee who performs emissions tests, sign a statement once every twelve months indicating that he has performed the emissions testing in accordance with state and federal regulations.
The approximate number of persons in the class, as provided by the defendant, is forty thousand (40,000). The value of the settlement and obligations of the defendant as set forth in the settlement agreement is greater than four million dollars ($4,000,000). Moreover, the plaintiff, as the representative of the class, will receive one lump sum payment in the amount of $10,000 to compensate him for his time being deposed, working with counsel to answer interrogatories and working with counsel on strategy. Plaintiffs' class counsel will receive $480,000 for attorneys' fees, costs and expenses which defendant has agreed to pay separate and apart from the settlement consideration to the class under the settlement.
There was no opposition to plaintiff's motion as the parties agreed to the terms of the settlement. Moreover, the parties request that pursuant to C.P.L.R. §908, this court schedule the settlement hearing for the earliest possible date at least 150 days after the date this court preliminarily approves the settlement and the class notice, to permit time for mailing notices to class members.
Accordingly, the motion by plaintiff for an order preliminarily approving the class action settlement agreement, preliminarily certifying the plaintiff class, preliminarily appointing Justin Jung as lead plaintiff and appointing the law office of William Coudert Rand and Jeffrey M. Gottlieb, Esq. as lead counsel for the class, is granted. The settlement hearing shall be held before this court on April 7, 2008.
Movant is directed to serve a copy of this decision with notice of entry upon the defendant and file proof thereof with the clerk's office.
This constitutes the decision of this court.
Settle order.
Dated November 5, 2007
J.S.C.
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