CINCINNATI (CN) — Despite the automaker never being charged criminally by the federal government, a class of Ford truck owners argued before an appeals court Wednesday that the company manipulated fuel economy tests and can be held liable in a civil lawsuit.
Consumers who bought F-150s from 2018-2020 and 2019 and 2020 Rangers brought a federal multidistrict lawsuit in 2019 claiming they were persuaded, in part, by inflated fuel economy statistics.
The buyers alleged numerous Ford employees notified the company about irregular fuel economy testing practices that generated inflated results, but the automaker refused to disclose concerns to the public.
Ford was investigated by the federal government and although no criminal charges were ever filed, independent testing confirmed the fuel economy statistics disclosed in advertisements were some 10 to 15% higher than the actual values.
The multidistrict litigation included truck owners from 28 states and was filed in the Eastern District of Michigan, where a federal judge ultimately granted Ford's motion to dismiss in February 2022.
U.S. District Judge Sean Cox, an appointee of George W. Bush, ruled all of the trucker owners' claims were preempted by federal law and agreed with Ford's claim that a court cannot impose "'non-identical' testing and disclosure requirements" other than those included in the Environmental Policy and Conservation Act.
In its brief to the Sixth Circuit, the class pushed back on Cox's characterization of the lawsuit and argued the owners "do not seek to hold Ford accountable to a higher or different standard regarding fuel economy estimates than required by the EPA."
The state-law fraud claims related to Ford's advertisements and claims of "best-in-class" fuel economy are not preempted, according to the brief.
"By cheating, Ford made its F-150 and Ranger trucks more appealing and competitive in the marketplace ... which, in turn, drove up sales and profits," it said.
Ford focused on the lack of criminal proceedings in its brief to the Cincinnati-based appeals court and emphasized the issue was closed when the Environmental Protection Agency concluded its investigation and found no wrongdoing.
"The factual premise underlying the complaint has been disproven," it said. "Since the complaint was filed, the EPA ... fully investigated these allegations, closed its investigation, and notified Ford that it did 'not intend to take further action.'
"That notwithstanding, plaintiffs ask this court to reverse so that, ultimately, a jury can substitute its opinions as to Ford's fuel economy testing for that of the EPA's ... regardless of what the EPA found and federal law required Ford to disclose."
Attorney Steve Berman of Hagens Berman in Seattle argued Wednesday on behalf of the truck owners and told the court his clients' claims were not preempted because the fuel economy requirements imposed by the states were identical to those mandated by the EPA.
U.S. Circuit Judge Richard Griffin, a George W. Bush appointee, asked Berman about primary jurisdiction and why the EPA shouldn't decide this dispute on its own.
"The EPA has closed the matter," the attorney said.
U.S. Circuit Judge Eric Murphy, a Donald Trump appointee, pivoted back to Berman's initial argument about the requirements he seeks to impose.
"You would require them to disclose a different [fuel economy] number," Murphy said. "I don't see how it could be described as identical."
"Ford did not follow the [correct] procedures," Berman answered. "If Ford had complied with the law, they would have published a different number."
Griffin asked about the process by which the fuel economy numbers are determined, and specifically whether the EPA has ultimate authority over the calculations.
"Ford does the test," Berman said, "Ford sends the numbers to the EPA. The EPA is relying totally on Ford's numbers."
The truck owners' attorney finished his allotted time by emphasizing their experts – the same individuals who were used in the Volkswagen emissions case – had conducted independent tests that confirmed Ford's numbers were incorrect.
Attorney Stephanie Douglas of Troy, Michigan-based Bush Seyferth PLLC argued on behalf of Ford and immediately disputed her opposing counsel's view of the matter.
"Test data isn't test data until the EPA says it's test data," Douglas said, which invalidates tests completed by the owners' experts.
"The idea that anybody can run the test without the EPA's oversight and come up with the same numbers is incorrect," she continued, telling the panel admission of other test results "entirely upsets the regime."
Douglas reiterated the EPA closed both its criminal and civil investigations without taking further action against her client and pointed out Ford went to the EPA when its employees first disclosed concerns about its testing protocols.
"Ford told the EPA when the questions came up. Ford cooperated with the EPA and the DOJ," she said.
In his rebuttal, Berman called the current setup for fuel economy standards an "honor system" that allows automakers to determine their own numbers prior to submission to the EPA.
"We're honoring Ford's numbers and adopting them," he said. "These are not the EPA's numbers."
Murphy disputed the attorney's claim and told him the argument sounded more like a critique of the way the EPA operates.
"Legally, I don't think it's significant," the judge said.
U.S. Circuit Judge John Bush, another Trump appointee, rounded out the panel. No timetable has been set for the court's decision.
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