Caterpillar’s £47 million settlement for a defect in heavy-duty engines

The Caterpillar Inc. class-action lawsuit reportedly produced favourable results for affected vehicle owners. Recently, a New Jersey judge approved a £47 million settlement to compensate owners for the alleged defects in their heavy-duty diesel engines.

The case, which has been litigated since 2012, recently came to a close when Judge Jerome Simandle of the U.S. District Court for the District of New Jersey approved the £47 million settlement offer.

Although a settlement has been reached, Caterpillar has made no admission of liability. The settlement seemed to be the only realistic way out for Caterpillar given the uncertainties and costs of continuing to fight the litigation.

The filing states that the settlement will provide affected engine owners with compensation between £400 and £8,000 which will be calculated on the amount of times that the vehicle has had a repair service. A service award to each of the 33 class representatives in the case, and also attorney fees (not to exceed one third of the settlement), are to be included as well.

Vehicle owners may be awarded up to £1,200 for expenses relating to the issue as well.

All claims for compensation must be filed by March 2017. An information website (www.enginesettlement.com) has provided further details of the settlement and offers ‘payments to current and former owners and lessees of vehicles with EPA 2007 Compliant Caterpillar on Highway C13 and C15 engines’, which were manufactured from 2006 to 2009.

Nature of the claim

The four year case addressed the allegation of whether Caterpillar’s engines were equipped with the heavy-duty engines that constantly failed and shut down when in use, and didn’t last as long as advertised. The allegations made by BK Trucking Company said that the machinery giant knew that its Caterpillar C13 and C15 Advanced Combustion Emission Reduction Technology (ACERT) diesel engines were defective. The Trucking Company went further, saying that, although Caterpillar allegedly knew of the defect, they still advertised the engines to be of high quality and reliable for potential purchasers.

The engines were designed with Caterpillar’s ACERT system in order to meet the 2007 soot and nitrogen oxide Environmental Protection Agency (EPA) emissions standards. But the allegations claim that Caterpillar sold the engines under false pretences as the vehicles weren’t reliable, durable, or equipped with a fuel-efficient system.

BK Trucking claimed that they bought ten trucks with the C13 and C15 engines between 2007 and 2010. During this period, BK Trucking reported that they experienced reoccurring breakdowns that were specifically related to the emissions and regeneration systems. Caterpillar continued to market the vehicles as being able to run for one million miles, but BK Trucking alleged that it broke down before the 250,000 miles mark.

Are Caterpillar’s in the U.K. affected?

It’s not yet clear whether any vehicles in the U.K. equipped with the heavy-duty engines are affected. The class-action settlement in New Jersey could likely have an effect on potential further class-action lawsuits worldwide though.