BMW of North America and its Dallas counsel, Hedrick Kring Bailey, have been sanctioned by Dallas County District Judge Eric V. Moyé and ordered to pay more than $773,000 for what the judge called “frivolous and groundless” efforts to bog down a lawsuit by a woman who claims she bought a used BMW that the automaker knew was a lemon.
In a scathing April 28 order, Judge Moyé said BMW and Hedrick Kring Bailey are jointly and severally liable for costs needlessly incurred by Jonathan C. Scott, the lawyer for plaintiff Whitney A. Walker of Dallas, in a 3-year-old lawsuit over Walker’s 2017 purchase of a used 2014 BMW i3. The pending suit contends that BMW offered the electric sports utility vehicle for resale knowing that it “had a long list of defects and problems” which BMW failed to disclose.
“This case is an example of a wealthy client (BMW NA) and its law firm (Hendrick, Kring & Bailey) using delay, misdirection, and both rejected as well as frivolous arguments to make litigation unfairly difficult and expensive for its opponents,” Judge Moyé wrote. “Unfortunately, this sort of conduct is not uncommon in our court system. Sadly, it was unusually egregious and persistent here.”
Jacob B. Kring, a partner in Hedrick Kring Bailey, declined to comment on the sanctions order. A hearing on the matter is scheduled for next Wednesday.
Scott said in an interview that his case against BMW has exposed “a national, longstanding, widespread practice” by BMW to dump faulty vehicles into the used-car market and to abuse the legal system by trying to overwhelm those suing the automaker with frivolous, overly burdensome pretrial legal maneuvers.
Judge Moyé appeared from his sanctions order to strongly agree.
“The court finds by clear and convincing evidence that BMW NA and its counsel’s conduct reflected sustained, concerted, bad-faith effort to throw obstacle after obstacle in front of the plaintiff — all in an attempt to push the plaintiff into either settling the case for less than she would have gotten otherwise or to make her trial presentation less persuasive,” he wrote.
He added: “The court finds that taken as whole, filings and responses to discovery made by BMW NA and signed by its counsel regularly have been frivolous and groundless, made either in bad faith or for purposes of vexing the opposing party and were based on false claims or not well grounded in law. …”
“The court finds that virtually every pleading filed in this case by HKB on behalf of BMW… responding to plaintiff’s discovery requests was made in bad faith. … HKB and BMW NA not only wasted plaintiff’s time and resources, but they also wasted this court’s time and resources and caused unnecessary delay and needless expense.”
Judge Moyé said that before imposing sanctions, he repeatedly warned BMW’s lawyers to knock it off — “to no avail.”
In her 2020 lawsuit, Walker — who has since married her attorney, Scott — contends that when BMW of Dallas offered the used i3 for auction, it knew, and did not fully disclose, “that the vehicle was a ‘lemon’ and that the vehicle had a long list of defects and problems.”
After purchasing the used SUV from a Plano dealer not affiliated with BMW, the suit says, “Ms. Walker and family members … received electrical shocks from the door sills of the subject vehicle when disconnecting the charging cable.” After she complained about that and other defects, the suit said, BMW of Dallas promised to repurchase the SUV from Walker and “to compensate her for loss of use of the vehicle and her other costs,” promises, the suit contends, that BMW later reneged on.
Judge Moyé has scheduled the suit for trial beginning June 6.