A Tennessee jury found that Navistar committed fraud with the sale of 243 Navistar International Prostars with Maxxforce engines and awarded damages of $30.8 million to the company that purchased the trucks.
The jury awarded Milan, Tenn.-based Milan Supply Chain Solutions $10.8 million in actual damages and $20 million in punitive damages on Thursday, Aug. 10, in Jackson, Tenn.
Milan alleged that Navistar, Lisle, Ill., misled them in the sale of the Navistar International heavy-duty trucks and engines and failed to disclose that the Maxxforce 13-liter engine was launched with serious known defects in the engine and its components.
“We at Milan are very pleased with the jury’s verdict in our case against Navistar,” Kevin Charlebois, CEO of Milan, said in a news release.
“We made every attempt to collaborate with Navistar to resolve these very legitimate engine issues, but rather than trying to sit down and work out a settlement, Navistar’s current executive team continues to blame their past management for the Maxxforce engine. We need Navistar to stand behind their product and step forward to address the damages caused by these engines, and we hope the jury’s verdict will lead to a change in Navistar’s tactics.”
The Maxxforce-powered Prostars were purchased by Milan in 2011 and 2012. The jury found that Milan lost more than $8.2 million in the diminished value of the trucks and more than $2.5 million in lost profits.
“We're disappointed in the jury’s verdict and are evaluating our options to challenge it,” Navistar said in a statement. “We have successfully defended similar claims regarding our Maxxforce 13 engines in several other jurisdictions, including dismissal of claims of fraud in courts in Texas, Wisconsin, Michigan, Indiana, Alabama and Illinois.
“Navistar tested the Maxxforce 13 engine consistent with industry standards. They were tested for 12 million miles prior to launch under rigorous conditions, in tests cells, and on the road. At the time of the product launch, we were confident, based on this testing, that the product would perform. All products undergo continuous improvement throughout their lifecycle. When some parts unexpectedly failed, we fixed them under warranty for our customers, including Milan Supply. We’ve invested a significant amount of resources standing behind our products and supporting our customers. Navistar strongly disagrees with plaintiff counsel’s characterizations of Navistar’s conduct. Navistar has and will continue to defend our products, our reputation in the market, and the integrity of our employees.”
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