DETROIT — DaimlerChrysler has settled a long-running lawsuit brought by the California Department of Motor Vehicles, agreeing to pay the DMV $325,000 in a "lemon" law case that alleged the auto maker resold defective vehicles to consumers.
The settlement was immediately criticized by consumer advocates as too lenient.
The company admitted no wrongdoing and was able to put an end to a suit filed by the DMV in 1994 alleging that the then-Chrysler Corp. repurchased and resold 119 defective Chrysler, Plymouth, Dodge and Jeep vehicles without telling buyers of their histories of problems and in some cases without repairing them.
DaimlerChrysler denied it concealed defects in cars it repurchased. "We have always complied with California lemon laws in terms of disclosing vehicles' repair history and sharing those with customers," DaimlerChrysler spokeswoman Ann Smith said Thursday. "We're certainly pleased we finally reached an agreement to this long-standing dispute."
After initially denying that there was a settlement, the DMV issued a brief statement late Thursday acknowledging the payment, which went to attorney fees and investigation costs to settle the complaint.
As part of the settlement, the DMV dropped the 45-day suspension of the company's license to do business in California that it had been seeking.
"I am very happy to have it resolved," DMV Director Steven Gourley said. "It has gone on now through four different DMV directors, and it was time to get it resolved. We think any manufacturer will think twice about trying to bring lemon vehicles into California."
Car buyers and consumer advocates expressed disappointment with the deal.
"That's pretty shocking. That's not very much money," said Terri Skogebo, a schoolteacher in Antelope whose 1989 Plymouth Colt Vista was one of the 119 cars involved in the suit.
"That's truly a superficial amount and really a victory for Chrysler, if they get away without admitting guilt," said Harvey Botwin, a professor of economics at Pitzer College in Claremont who teaches a course called "Cars and Culture."
Rosemary Shahan, president of the Sacramento-based advocacy group Consumers for Auto Reliability and Safety, agreed that Chrysler got off easy. "I'm sorry Chrysler wasn't banned for at least one day, because what they did was endanger people, and I don't think the penalty fits the crime," Shahan said.
