— A federal judge has tossed out a Ford Mustang hood corrosion lawsuit saying the "galvanic corrosion" theory has "fallen apart" and the plaintiffs failed to establish any "ascertainable loss" due to the alleged Ford Mustang hood corrosion.
Plaintiffs Williams Mickens and Mark Solomon filed the Ford Mustang hood corrosion lawsuit alleging Ford knowingly sold Mustangs with a design defect that caused aluminum hoods to corrode.
The lawsuit alleges plaintiff William Mickens purchased a new 2006 Mustang GT for $29,350 on September 29, 2005, from a New Jersey dealership. That price included Ford’s New Vehicle Limited Warranty, which provided “Bumper to Bumper” coverage for three years or 36,000 miles, whichever came first.
Ford also provided “Corrosion Protection” coverage for five years and unlimited miles for perforations in the car’s body sheet metal panels due to a manufacturing defect or worker error.
On March 25, 2008, Mickens took the car back to the Ford dealer because he observed “paint bubbling on the hood.” Mickens said it resembled “little pinholes” on the passenger side along the front ridge of the hood, along with white corrosion “underneath the hood in the seam.” The repairs were paid for under the Ford Mustang warranty.
Mickens said he again noticed bubbles and corrosion on the hood three months after it was repaired and finally took the Mustang back to the dealership. Ford again repaired the hood under warranty, but Mickens said he wasn't pleased with the work, calling it a "lousy job." To fix the problems, the Mustang was taken back to the dealer five or six times, each time covered under the warranty.
On November 16, 2009, Mickens contacted Ford about the problem with the hood. Ford agreed to help but later said no because the three-year warranty on the Mustang had expired.
In June 2010, Mickens asked two independent body shops for estimates to repair the hood and was told the hood needed to be replaced, something Mickens refused to do.
Plaintiff Mark Solomon purchased a new 2011 Mustang GT with a 3-year/36,000 mile “Bumper to Bumper” warranty, and a 5-year/unlimited mile “Corrosion Protection” warranty. In the summer or fall of 2012, Solomon noticed paint on the lip of the hood was “bubbling.” He did not contact Ford or have the car examined because the damage “was small."
In early 2013, the paint began chipping on the interior of the hood and he brought the car to a dealer. Although he was told Ford would fix the hood under warranty, Solomon declined the repair because he said the repair wouldn't work. He eventually bought and installed an aftermarket hood made of carbon fiber.
The plaintiffs allege that Ford knowingly concealed numerous facts, all of them related to galvanic corrosion in the aluminum hoods of the Mustangs. The lawsuit alleges Ford failed to disclose the Mustang hood panel was made of aluminum and omitted to tell consumers that most body shops lacked experience with the repair of aluminum body panels.
The lawsuit also alleges Ford didn't tell consumers it had not performed adequate corrosion testing on Mustang hoods and that the automaker concealed the corrosion tests that had been performed. However, those tests had been developed for use on steel body panels but did not work with aluminum.
The plaintiffs further claim Ford didn't tell consumers that its internal warranty data showed the Mustang aluminum hood panel was five times more likely to experience corrosion than the aluminum panels used on other Ford vehicles.
The plaintiffs allege Ford engaged in unlawful and deceptive practices, a charge the judge denied. Although the plaintiffs didn't claim Ford violated breach of warranty, the judge says that specific claim might have made it through the legal hurdles.
The court said that left the basic question: Did Ford commit consumer fraud by concealing or evading responsibility for a design defect concerning the Mustang hoods? The short answer is, no.
Galvanic corrosion tends not to perforate a vehicle's body panel and although Ford's 5-year, unlimited-mileage warranty includes coverage for corrosion, it applies only to corrosion that perforates the body. Non-perforating corrosion is covered only under the 3-year/36,000 mile warranty.
The plaintiffs claim Ford knew long before about the Mustang hood corrosion problems because on December 27, 2004, Ford issued to its dealers a technical service bulletin (TSB) reference number 04-25-1, entitled "Aluminum Corrosion - Service Tip."
That TSB noted twelve models of Ford, Lincoln and Mercury 2000-2004 vehicles "may exhibit a bubbling or blistering under the paint on aluminum body parts." The TSB instructed Ford's authorized service representatives to sand and paint the affected area, but did not instruct them to address the underlying corrosion problem.
However, the judge ruled any claims against Ford for damages to Mustangs before the 2005 model year are false because Ford could not have had any knowledge that galvanic corrosion of aluminum hoods would occur in the 2000-04 models. Those cars did not have aluminum hoods but had hoods made of “sheet molded compound.”
The judge said it is undisputed that aluminum hood panels were not installed in Ford Mustangs until 2005. Since Ford did not install aluminum hood panels on the Mustang until 2005, the alleged duty to disclose a defect could not have arisen until the 2005 model year, at the earliest. However, even for later years, the court ruled the evidence does not present a material factual dispute as to whether Ford knew “with certainty” the Mustang’s aluminum hood would experience galvanic corrosion.
The judge said that after reviewing the record, the plaintiffs’ deceptive conduct claims "must fail because the plaintiffs are unable to show that they suffered an ascertainable loss."
As for the specific claims of the plaintiffs, the judge said Solomon sought to recover the cost of replacing his hood and doesn't dispute that Ford offered to repair the Mustang hood under warranty at no cost to him. Solomon admittedly refused that offer because he personally believed it “was not going to fix the problem.” The court ruled the amount Solomon spent on the replacement hood is not an ascertainable loss.
Solomon conceded at his deposition “he believed the problem with his hood could only be permanently fixed by installation of a replacement hood, so he bought one.” The judge ruled that a consumer’s belief that a warranty repair would be insufficient does not entitle him to rewrite the warranty or engage in preemptive self-help at the manufacturer’s expense.
Although Solomon was free to decline the warranty repair, he cannot lay the costs on Ford because of his preferred method of repairing the corrosion.
As for Mr. Mickens, the court ruled he too is unable to demonstrate ascertainable loss. Mickens does not dispute the corrosion on his Mustang hood was repeatedly repaired under warranty, and on one occasion even after the warranty had lapsed. However, the judge said he cannot presume this significantly impaired the value of the car.
Mickens’s claim of loss is that, but for the defect in the hood, he could have received more money when he traded in his 2006 Mustang and purchased a newer model. Mickens received a trade-in value of $17,000. He testified in his deposition that he believed he could have received anywhere from $19,000 to $21,000 for a car without the hood corrosion.
However, after reviewing the evidence, the judge said Mickens’s testimony and a supporting expert report fall short of the “specific proofs to support or infer a quantifiable loss.”
Ford provided evidence that according to the March 2011 edition of the NADA Official Used Car Guide, the average “clean trade-in” or best-condition value for a 2006 Mustang with mileage comparable to that of Mickens is $16,550. That is $450 less than the $17,000 Mickens received for his allegedly impaired trade-in.
The judge ruled Mickens cites no evidence to create an issue of fact that he received less than the fair value of a Mustang without hood corrosion.
Therefore, the court ruled the deceptive conduct claim fails as a matter of law and Ford's motion to dismiss is granted.
The Ford Mustang hood corrosion lawsuit was filed in the United States District Court for the District of New Jersey - William Mickens and Mark Solomon v. Ford Motor Company.