A federal judge has rejected a proposed settlement in a class-action lawsuit that emerged due to a spike in Hyundai and Kia vehicle thefts. The judge stated that the settlement does not offer appropriate relief to vehicle owners.

The settlement, which was announced in May, had a potential value of $200 million. It aimed to cover approximately 9 million Hyundai and Kia vehicles from the model years 2011-2022 in the United States.

These particular vehicles lack push-button ignitions and immobilizing anti-theft devices, which has made them an easy target for thieves using simple tools like screwdrivers and USB cords. Consequently, there has been a significant increase in auto thefts across the country.

The proposed settlement included cash payments to vehicle owners for theft-related damages and a voluntary recall to update theft-protection software. However, U.S. District Judge James Selna raised concerns about the calculation process for payments and the effectiveness of the software update in preventing future thefts.

Hyundai and Kia had announced the software update in early 2023, claiming it would address security vulnerabilities that were exposed on platforms like TikTok and other social media sites. However, The Associated Press reported in May that thieves were still successfully stealing Kia and Hyundai vehicles at alarming rates.

The news agency gathered data from eight major U.S. cities, revealing substantial year-over-year increases in theft reports in seven of them through April.

In response to these concerns, attorneys general from six states and the District of Columbia wrote a letter on August 11th, urging Judge Selna to mandate the installation of antitheft technology called engine immobilizers in all Hyundai and Kia vehicles prone to theft. They suggested that this implementation could be combined with a vehicle buyback program as an alternative to the software update and cash payments.

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