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January 21, 2002 01:00 AM

Attorneys challenge Cooper settlement

Miles Moore
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    NEW BRUNSWICK, N.J.-Plaintiffs' attorneys and a consumer watchdog group-upset at what they perceive as the inadequacy of Cooper Tire & Rubber Co.'s proposed settlement of 32 pending class actions-are challenging the agreement in court.

    ``About a dozen'' objections to the settlement have been filed in the Superior Court of New Jersey-Middlesex County, according to Bruce Kaster, an attorney with the Ocala, Fla., firm of Green, Kaster & Falvey.

    The irony of the situation, Mr. Kaster noted, is his firm was the first to file a class-action lawsuit against Cooper, and now it's opposing the settlement.

    Mr. Kaster filed his first objection with the court in December, followed by an addendum Jan. 16. ``The proposed settlement does nothing more than drop all claims of warranty violations, fraud, or unfair and deceptive trade violations against Cooper Tire in exchange for a few replacement tires (given out at Cooper Tire's discretion) and a handsome fee to class counsel,'' he said in the addendum.

    Judge Marina Corodemus of the New Brunswick court gave preliminary approval to the settlement agreement Nov. 1.

    In the agreement, the tire maker offered Cooper customers a free replacement tire for every steel-belted radial made by Cooper between 1985 and 2001 that suffered a tread separation caused by a manufacturing defect.

    The Findlay, Ohio-based tire maker also offered to modify final inspection procedures for Cooper tires just before they enter the warehouse, and to create a massive consumer tire safety education program through all retailers selling Cooper brand and Cooper-made tires.

    Cooper said that, through the settlement, it was offering an extended warranty free of charge to consumers. Mr. Kaster, however, said the warranty is ``illusory, and wholly subject to the arbitrary decisions of Cooper Tire executives or retailers regarding what, if any, benefit any given consumer is to receive.''

    Consumer group Public Citizen concurred with Mr. Kaster in a court filing made Jan. 16. The group found the settlement inadequate in all particulars, and said the $30 million compensation provided in the settlement to plaintiffs' attorneys was ``grossly out of proportion to the meager remedy that would be afforded members of the class.'' The whole agreement is worth $55 million, according to Cooper's calculations.

    The inspection program Cooper offered ``will do nothing to rectify the manufacturing defects and quality control lapses at issue in the suit,'' according to Public Citizen. ``At best, these improvements would benefit future owners of Cooper tires, who are not involved in this case.''

    Similarly, the consumer education program ``does not focus on the problem with Cooper tires identified in this class action-namely, that Cooper tires may contain latent defects that increase the risk of tread and belt separation,'' Public Citizen said.

    ``Unfortunately, the consumer education program is more of a marketing opportunity for Cooper Tire than a serious effort to deal with the problems in its manufacturing process,'' the watchdog group added.

    Noting that the tire maker would offer a tire safety kit for sale to consumers, Public Citizen said:

    ``The conclusion is inescapable that this last feature of the proposed settlement is also purely cosmetic and designed to benefit Cooper Tire more than the class.''

    A Cooper spokeswoman said that ``when the time comes, we will respond formally and appropriately in court.'' Judge Corodemus set Jan. 29 as the date for the court to consider final approval of the agreement.

    Plaintiffs' attorneys who negotiated the settlement with Cooper could not be reached for comment.

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