Total Recall - A Preemptive Attack on Product Liability Class Actions

Two recent cases establish that effective recall programs can undermine a plaintiff’s proposal to certify a product liability class action. 

Larsen v ZF TRW Automotive Holdings Corp, 2023 BCSC 1471[1]

The British Columbia Supreme Court declined to certify this proposed class action alleging a defect in airbag control modules manufactured by some defendants, and used in other defendants’ vehicles. Though the plaintiff alleged that the defect prevented airbags and seatbelt pretensioners from deploying in rare collisions, she alleged no damages from injuries to person or property – she alleged only pure economic losses.

The Court refused certification because, among other things, the defendants implemented recalls pursuant to motor vehicle regulations to remove the risk of airbag failure in affected vehicles. Despite the Court’s conclusion that a recall constitutes “some acknowledgment of a defective design or manufacturing”, the plaintiff’s failure to provide evidence that repaired vehicles remained defective undermined the potential for certification, including by establishing a lack of “compensable harm”.[2]

The Court in Larsen relied on the Ontario Superior Court of Justice’s decision in Coles v FCA Canada Inc, 2022 ONSC 5575, another decision dismissing certification of a class action alleging airbag failures. The Court in Coles held that a recall program was preferable to a class action when the plaintiff “dawdled” for years rather than seek certification promptly. The Court in Larsen did not address the timing issue adverted to by the Ontario Court, but concluded broadly that the free recall repair provided the proposed class members with access to justice.