Ford Focus and Fiesta owners say the money is flowing.
And for others who have struggled with defective transmissions, deadlines are fast approaching to apply for financial relief.
More than 2 million consumers who may qualify for compensation ranging from a $20 inconvenience payment to a total buyback that may exceed $20,000 received postcards in April alerting them that it was time to claim their cash as part of a class action lawsuit filed in 2012 and resolved in 2020.
Ford customers claimed in legal filings their 2012-16 Focus and 2011-16 Fiesta compact cars were built with defective transmissions prone to “shuddering, slipping, bucking, jerking, hesitation while changing gears, premature internal wear, delays in downshifting and, in some cases, sudden or delayed acceleration.”
If car owners or lessees hadn’t formally opted out of the court case, they were automatically included in the settlement even if they may not realize it.
Emma Banze, 31, a business consultant from Atlanta, Georgia, sold her 2012 Focus back to Ford in April and received a check for $17,655.99.
“My whole family has driven Fords and Lincolns since I grew up in Detroit,” she said Wednesday. “That Focus was the first car that I owned, and it quickly became apparent that this was going to be an ongoing problem with only temporary fixes. I had my clutch repaired three times and so many other repairs. When I started it, it would stall. On my way to meet my husband in the emergency room one night, it slipped out of gear while I was in traffic. I had to pull into a neighborhood and when I tried to turn around, I got stuck in reverse, I had to turn off the car because I couldn’t get it to shift gears. I’m not looking at buying another Ford.”
The Livonia native now depends on a 2011 Toyota Corolla, “which is dependable.”
Who qualifies
A Free Press “Out of Gear” investigation published in July 2019 revealed for the first time internal company documents and emails showing Ford knew the transmission was defective before putting the vehicles on the market and continued building and selling them over the past decade as customers spent thousands on repairs.
More:Ford to pay millions to Focus, Fiesta owners in transmission settlement
More:Ford Fiesta, Focus owners could get thousands of dollars apiece, lawyers predict
More:Postcards sent to Ford Focus, Fiesta owners could be worth thousands of dollars
Ford whistleblowers described to the Free Press in 2019 a fearful atmosphere within the company that led to silence during development of the dual-clutch “Powershift” (DPS6) transmission and, in one case, downgrading the risk assessment of the clutch and control unit “due to political reasons.”
The vehicles have been the subject of massive litigation and congressional inquiry and an ongoing federal criminal fraud probe. Ford spokesman T.R. Reid, when asked for an update on the federal probe, said, “There is nothing to say here.” And Matt Lloyd, spokesman for the Criminal Division of the Department of Justice, said Friday, “We have no comment.”
The litigation costs were flagged in a Ford earnings report in April 2019 and have been acknowledged and discussed by company executives during earnings and industry analyst meetings.
A month after the Free Press investigation, Ford extended warranty coverage to 600,000 vehicle owners.
A Sept. 25 deadline
Consumers have six years from their date of purchase or, if that window has passed, six months from the official effective settlement date of April 6 to pursue arbitration for buyback.
“There’s a notice period, where you tell Ford you intend to arbitrate and they have 10 days to resolve the situation. If they don’t resolve it, you may go to arbitration, which Ford pays for,” Tarek Zohdy, senior counsel at Capstone Law in Los Angeles, said in April. “The bar is not high. All you need is to collect your repair orders and your purchase contract and submit a letter to Ford. We will help people do that.”
He worked with Ford lawyers to craft the deal.
“For vehicles that have already been in service for six years, the deadline to submit a notice of intent to arbitrate is currently September 25, 2020, and the deadline to open an arbitration is October 5, 2020,” he said in an email to the Free Press on September 11.
The Free Press has been corresponding with hundreds of Ford Focus and Fiesta owners over the last 18 months who provided reams of paperwork amid anger and frustration buffered by relief when a check arrived.
Some spoke to the newspaper and provided details and paperwork from various parts of the country, but said they were too humiliated by the experience to allow their names to be used for this report.
“While COVID-19 has caused delay in administration of the settlement, we’re happy that owners are getting buybacks, so the program is working as intended,” Zohdy said. “We are seeing that firsthand with the owners we are assisting who have been getting very positive results.”
If a vehicle owner needs legal help, he said, “we would advise them to contact a local lemon lawyer as soon as possible. We are personally assisting hundreds of people, and have tirelessly worked to assist as many owners as we can file their arbitration claims.”
Ford is working to quickly resolve class action claims with customers, Reid told the Free Press. “Earning and, where necessary, restoring — and then keeping — the trust of customers is vital to Ford. Resolving these cases equitably and promptly is one way we can do that.”
Sweet revenge
Jean Esposito, 62, an occupational therapist in Massachusetts sold her 2016 Focus back to Ford in April for $22,000 in cash and loan payoff.
“I had four clutch replacements,” she said after returning her vehicle to Framingham Ford. “And I had trouble with that car pretty much from day one.”
After happily owning a Honda and a Subaru, Esposito purchased a 2020 Hyundai Kona. She said she refused to give up after writing Ford in September 2017 and getting a reply telling her she needed to better understand how the car rides and road conditions.
“That made me really mad,” she said. “We’re not dealing with Ford anymore.”
Costly typos discovered
Hershel Cecil, 77, a retired general contractor from Lake Havasu City, Arizona, sold his 2013 Focus to Ford in August for $22,300 after filing for arbitration himself when he struggled to find a lawyer who could help him.
“I had a new clutch put in at 68,000 miles and looked at the repair order, and looked at the repair order from 11,000 miles, and it was the same part number. They had done nothing to fix the problem,” Cecil said Tuesday. “They were just replacing parts until time ran out. At that point, I was pissed.”
He urged anyone who owns a car to keep every piece of paperwork for emergencies, especially when Ford repeatedly misstated mileage and repair dates when calculating his settlement. “They came up with the wrong figure twice. You can’t say it’s a typo when it’s the wrong year of repair, too. But I had the paperwork.”
His wife, Elaine Cecil, 63, a retired office manager, said, “They know they had a problem and they were just trying to hide it. If they would’ve dealt with it ethically from the beginning, I would feel different about buying a Ford. I know a couple other people who had Focuses and traded them, and they won’t buy Fords again.”
7 broken clutches
Tony Rinaldi, 67, and his fiance, Marlene Teague, 66, both of Lincoln Park settled their claim with Ford in March for $1,500 to cover repairs on their 2012 Focus plus legal fees for their heartache. The process of navigating the website was a frustrating nightmare, they said, so they turned to lawyer Steven Toth of Consumer Legal Services, based in Garden City for the past 25 years.
The outcome, Rinaldi said, “was frustrating but worthwhile.”
Dozens of clients are in the pipeline awaiting arbitration for Focus and Fiesta, Toth said.
“These are the worst vehicles I’ve ever seen and it’s not even close. If you make a product, you stand by it. Not with these DPS6 transmissions,” he said. “If I do 100 cases on the same vehicle, that’s a lot. With this, between my offices in Michigan and California, I’ve probably handled over 10,000. The sheer volume tells you there’s a problem. People come in where they’ve had 2, 3, 5, 7 clutches replaced.”
A lot of people who contact him realize they’ve tossed the postcard notifications, he said, because they can look like junk mail.
‘No idea’
Nancy McLean, a businesswoman in St. Clair, has replaced five clutches on her 2014 Focus, the first fix coming just one year after buying the car in October 2013. Now she’s trying to get into the settlement cue with hope of financial relief.
“On July 30, I made an appointment at the dealership and they said you have to have the transmission replaced for $7,677.05. He said, ‘Well, parts go,’ ” McLean said.
After McLean had trouble with the class action website, a local dealership sent her to a Ford help center to assist with paperwork. “I sent it in about two weeks ago. Now, the car is sitting in my driveway. I have no idea what to do with it.”
She explained, “When the third clutch went, they told me, ‘They’ve got a new clutch and we feel like this is going to work better.’ Maybe when you start up it goes forward and maybe it doesn’t. When I put my foot on the accelerator, it jumps a little bit and then takes off. You put up $20,000 for a car and now they want me to put almost $8,000 into fixing it.”
McLean and her family members are longtime Ford customers, she said. “Now I’m looking at GM.”
$47M paid out in 2019
Some people who filed the arbitration claim before the settlement went into effect, when Ford voluntarily honored the program the settlement created, have recovered more than $20,000 each, according to lawyers who crafted the agreement.
“You could see where this settlement could end up costing Ford hundreds of millions of dollars, potentially $500 million,” Michael Kirkpatrick, a lawyer at the nonprofit Public Citizen consumer advocacy group, said in March.
But the class action lawyers at Capstone said the settlement could be valued in the billions. An estimated 2 million vehicles qualify for some form of payment and Ford already spent nearly $47 million for just 2,666 cars in 2019.
Ford declined to reveal how many cars had been repurchased or how much money had been paid in 2020, saying the data the Free Press cited was from a court document.
“Those data aren’t part of our regular public reporting and there aren’t updates to provide,” Reid, the Ford spokesman, said.
The Free Press investigation revealed a 2016 Ford internal report Ford that projected costs through 2020 and said, “Total quality related spending for DPS6 could reach $3 billion.”
At least 1.5 million of the vehicles remain on the road today, according to U.S. vehicle registration data.
There are two ways to qualify for repurchase: Either under the lemon law of the state where you purchased the vehicle or under the settlement-created standard of four transmission hardware repairs within five years or 60,000 miles.
The final settlement includes a minimum $30 million in cash payments from Ford to customers that are separate from the buyback program. Consumers may apply for both programs.
The $30 million pot is set aside for smaller payments of anything from $20 to $2,350 for customers who may not qualify for a buyback. The settlement agreement requires Ford to spend all $30 million, so after everyone applies for what may seem like a trivial amount, if any money remains unclaimed, those consumers who applied may receive a second payment check because “the residue” of the $30 million must be distributed.
A different path
George Simon, 91, of Tustin, California, said he couldn’t successfully make a claim through the class action website so he appealed to the Better Business Bureau to get involved and help convince Ford to buy back his 2014 Focus Titanium.
It worked.
Ford cut a check for $23,843 in May, he said, though they never kept a promise to reimburse the half-dozen tow charges he incurred.
Simon, a retired combat U.S. Marine who later worked as a satellite communications engineer, provided the Free Press with work orders, receipts, settlement documents and written correspondence with Ford.
“They made excuses for four to five years. We had serious incidents where it could’ve been catastrophic. The engine running, put it in gear and it doesn’t move in traffic? They kept saying, ‘Keep bringing it in George, and we’ll see what we can do,’ ” Simon said. “Ford really let me down. My sons have Toyotas — marvelous machines. They have a problem, they get it fixed. I do not trust Ford.”
More:Mysterious problems disrupt delivery of 2020 Ford Explorer, Lincoln Aviator
More:Some Lincoln Aviator owners battle serious problems with luxury SUV
More:At Ford, COO Jim Farley looks to speed as he plans to move company into the future
New cases
All class members, which are defined as people who purchased or leased vehicles prior to April 25, 2017, may qualify for cash under the settlement. However, later purchasers should still pursue relief through the arbitration program for buyback as they may be considered.
Meanwhile, lawyer Steven Toth said distraught consumers with transmission repair bills who purchased a Focus or Fiesta after the class action deadline of April 25, 2017, are now suing Ford independently; they are not covered by the settlement and have the same rights as any consumer to file action against Ford.
On the subject of additional claims, Ford spokesman Reid said some could be resolved by now but haven’t because of other litigation. Reid said a federal judge in California rejected in early September a fraud claim relating to how the DPS6 “PowerShift” works, finding the term “automatic” is not deceiving.
“Those claims have long been an obstacle to closing out what should be simple warranty cases,” he said. “Hopefully, the ruling will prompt lawyers who have been seeking windfall payments for themselves to turn control of the litigation back to their clients, so Ford and the customers can settle their cases.”
In fact, a judge in state court in San Diego issued a tentative ruling on Thursday that “fraudulent concealment” is a viable claim against Ford and, after hearing oral argument, finalized that ruling on Friday, said lawyer Roger Kirnos, a partner at the Knight Law Group in Los Angeles, who represents more than 200 clients suing over the defective transmissions, all of whom first asked Ford for help, and were refused, before filing lawsuits.
“Ford has adopted the tried and true defense approach of attacking the lawyers who represent consumers rather than acknowledging that it deceived nearly two million of its customers across the country over the course of several years,” Kirnos said. “Cigarette companies used to call their adversaries greedy lawyers too, and we know how that went.”
More info
The postcards sent to consumers were drafted by both Ford lawyers and class action lawyers and then approved by a federal judge. The notices were actually mailed by KCC, a legal claims administrator.
The websites below offer consumer information that includes how to file a claim:
http://fordtransmissionsettlement.com/submit-a-claim.aspx
More:Out of Gear: Follow the full Ford investigation
Contact Phoebe Wall Howard at 313-222-6512 orphoward@freepress.com.Follow her on Twitter@phoebesaid. Read more on Ford and sign up for our autos newsletter. Your support makes a difference. Become a subscriber