Thousands of owners of recalled General Electric Co. (GE) dishwashers must stick with a legal settlement reached years ago, giving them each only U.S. $20 for a new machine, a U.S. federal appeals court has ruled.
The U.S. Court of Appeals for the Ninth Circuit ruled that dissatisfied GE customers at one point had "the opportunity to opt-out and individually pursue any state law remedies" if they were not satisfied with the settlement, which was approved in 2002 by a federal district court.
The San Francisco, CA, U.S.-based appeals court affirmed that the district court had federal jurisdiction to settle class action suits filed in various state and federal courts concerning a dishwasher recall because the suits alleged violations of federal racketeering law.
GE and a federal commission had proposed a single settlement to all lawsuits stemming from terms the company offered during a 1999 recall of some 3 million dishwashers.
GE recalled dishwashers sold between 1983 and 1989 because of their potential to cause fires and offered owners cash rebates of $75 to $125 toward purchases of new GE dishwashers or a cash refund of $25 for dishwashers not made by GE.
Unhappy with the terms, many consumers filed lawsuits, which were later consolidated into a number of class-action suits.
Most of the consolidated lawsuits alleged that GE violated the federal Racketeer Influenced and Corrupt Organizations act, or RICO, during the recall.
GE settled separately a lawsuit filed by the New York Attorney General on behalf of New York residents. Other suits filed in U.S. state courts in Illinois, Connecticut, California, and Florida were consolidated with the allegations of federal RICO violations.
A district court in January 2002 approved a single settlement that gave plaintiffs $20 each.
Some plaintiffs objected to the settlement, noting that GE's settlement with the U.S. New York State gave owners of recalled dishwashers in the state up to several hundred dollars.
"What we think is unfortunate is this condones the use of federal courts on a transparently hooked up business transaction," said attorney Clinton Krislov of Krislov & Associates law firm in Chicago, IL, U.S. He represented the plaintiffs who appealed the District Court ruling.
George Donaldson, the San Francisco, CA, U.S. attorney for class-action plaintiffs who settled with General Electric, said he was glad the complicated case was over. (Reuters)
to Daily News