Navistar Seeks to Consolidate Lawsuits Tied to EGR Engines

This story appears in the Dec. 8 print edition of Transport Topics.

Attorneys for Navistar last week asked a federal multidistrict panel to consolidate as many as 17 lawsuits alleging the company sold tractors with defective MaxxForce 13-liter engines featuring advanced exhaust gas recirculation emission systems.

In a related development, a federal magistrate in Dallas last week approved, in part, a request by trucking company Ross Neely Systems that Navistar hand over documents related to the MaxxForce EGR engines by Dec. 31.

Separately, Navistar announced a new fuel-efficiency package for its International ProStar ES (see story, p. 35).

In the hearing before the U.S. Judicial Panel on Multidistrict Litigation in Charleston, South Carolina, Navistar International Corp. and its subsidiary, Navistar Inc., requested that the cases be consolidated and heard by a federal judge in Chicago, near its headquarters in Lisle, Illinois.

Jeffrey Luthi, clerk of the multidistrict panel, confirmed to Transport Topics the Dec. 4 hearing. The truck maker filed its motion for transfer and consolidation with the multidistrict court Oct. 6.

A Navistar spokesman declined to comment regarding pending litigation. The company is due to report its latest quarterly financial results later this month.

“Barring transfer and consolidation, these cases pose a serious risk of unnecessary duplication of effort, inconsistent and conflicting pretrial rulings and the wasting of both judicial and party resources,” Navistar said in a court filing during November.

The company told the multidistrict panel in filings ahead of the Dec. 4 hearing that there are “12 putative class cases and 18 non-class similar cases pending against Navistar in a multitude of federal and state courts around the country.”

Navistar noted Ross Neely Systems objected to the request for transfer and consolidation.

“As Navistar made clear in its opening memorandum, however, Ross Neely is in a materially different procedural posture than the other 17 cases now pending in federal court, and it most likely makes sense at this point to exclude Ross Neely from any

consolidated action,” Navistar told the panel.

Typically, a decision by the multidistrict court is made the same day as the hearing. However, the actual order of decision is not made public for several weeks, Luthi told TT.

Ross Neely Systems, which purchased 15 ProStar tractors with 2010 MaxxForce 13-liter EGR in 2011, has accused Navistar of warranty and contract breaches, and fraud in its 2013 lawsuit, court documents said.

The Birmingham, Alabama-based fleet alleged it was misled by Navistar officials in statements and advertisements that the EGR system would get better mileage, save on maintenance costs and save money because the system would not require the use of diesel exhaust fluid.

Instead, the engines experienced frequent problems related to the EGR system, spending excessive times in the shop for repairs, Ross Neely said in its lawsuit.

“In fact, the trucks are taken into the Navistar network for repairs and delayed with such regularity that plaintiff has been forced to keep four of its older model Freightliner trucks on hand just so that it can continue to fulfill orders when the trucks go down,” Ross Neely said.

Unlike its competitors, Navistar chose EGR emissions technology to meet 2010 emissions standards.

However, the company announced in July 2012 that it was abandoning the EGR system and adopting SCR.

Meanwhile, Magistrate Judge David Horan in Dallas concurred with Ross Neely’s request that Navistar relinquish documents related to the MaxxForce 2010 13-liter EGR engines. The records included those used to advertise and market the EGR engine, testing documents and analysis or compilations of data reflecting the overall performance, reliability and durability of the engine.

Navistar also has been ordered to turn over documents regarding certification submissions to the Environmental Protection Agency, the nature of claims asserted by several large fleets and documents regarding communications with MAN SE and Cummins Inc., companies that previously used EGR technology.

Ross Neely’s filing noted on Nov. 13-14 its attorneys took the depositions of two former Navistar employees, James Hebe, senior vice president of North American sales operations, and Philip Tindell, vice president of North American regional sales.

“According to those witnesses, defendants’ high-level employees and management were well aware of the problems defendants were having with their development of EGR technology, and were aware that the trucks its dealers were selling were not free from defects,” Ross Neely attorneys stated.