Mercedes-Benz $482,000 lemon law case

March 11, 2010

Mercedes-Benz has been ordered to pay a total of about $482,000.00 in a lemon law case out of Wisconsin.

In 2005, a consumer bought a Mercedes-Benz E320 for about $56,000.00.  The vehicle required repeat repair attempts because it would not start. The dealership was never able to correct the problem. The consumer hired an attorney, who was able to get Mercedes-Benz to agree to repurchase the vehicle. But  Mercedes took more than the 30 days Wisconsin law allows a manufacturer to provide a refund of the purchase price.

Two years later, in 2007, the consumer won a summary judgment  motion against Mercedes-Benz. This is a process by which a Judge decides if, based on the facts in evidence, whether a decision can be reached without the need for a jury. It is not clear what prevented settlement during that time, but it appears Mercedes-Benz claimed the consumer caused some of the delay by not providing information fast enough. The consumer, though, was entitled under Wisconsin law to double damages once Mercedes-Benz missed the 30-day deadline.

After losing summary judgement, Mercedes-Benz appealed. In 2008, the Wisconsim Court of Appeals ordered a trial. While acknowledging that a manufacturer cannot ignore or extend the 30-day deadline for any reason, the Court of Appeals agreed that a trial was necessary to determine if the consumer had purposefully caused Mercedes-Benz to miss the deadline.

In 2009, a Wisconsin jury awarded the consumer nothing. But the trial judge overturned the jury’s verdict, saying it was not supported by the evidence. While not common, a Judgment Notwithstanding the Verdict (JNOV) is an appropriate legal decision in some circumstances.

The consumer, who was still driving the vehicle, was awarded double the purchase price, plus interest. The consumer’s attorneys were awarded approximately $314,000.00 in fees and costs. That is a large amount, to be sure, but not unreasonable in light of several years of litigation.

Could this happen in Missouri? Unfortunately, there is no provision for double damages or a 30-day deadline for payment from a manufacturer. But, if a consumer is willing to continue to fight, they may be able to recover a full refund, including all collateral expenses, plus attorneys’ fees.

The Wisconsin case, though, underscores just how expensive a court case can become for a manufacturer. The $482,000 does not even include the hundreds of thousands of dollars Mercedes-Benz likely spent on their own attorney’s fees and costs, or the negative publicity the case generated. Perhaps the case will sound a note of warning to other manufacturers that satisfying the consumer early in the lemon law process is the right thing to do.

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