Key Takeaways
As product manufacturers face a growing trend of government suits based on third-party criminal conduct, companies should monitor how New York's Court of Appeals addresses the novel question of whether car makers owed a duty to cities to install anti-theft devices.
The question arises in an MDL, In re Kia Hyundai Vehicle Theft Marketing, Sales Practices, and Products Liability Litigation (C.D. Cal. MDL No. 3052). In that MDL, product liability claims stemming from car thefts have converged with a rise in litigation by local governments against product manufacturers for public costs tied to product misuse.
Starting in late 2020, when a group of teenagers known as the "Kia Boyz" posted social media videos with instructions on how to steal certain cars, a trend of thefts and accidents ensued in New York and elsewhere. City of Buffalo v. Hyundai Motor Am., Inc., 140 F.4th 1249, 1250-52 (9th Cir. 2025). A group of municipalities sued the car makers, claiming they were wrongfully forced to expend resources to address car-theft-related safety issues and property damage. The cities sued for public nuisance and negligence, seeking to hold the manufacturers liable for failing to install "immobilizers" or other anti-theft devices. Id. at 1252.
After the district court denied the car makers' motion to dismiss, the Ninth Circuit granted an interlocutory appeal on the negligence claims. A divided panel affirmed the lower court's decision under Wisconsin and Ohio law based on a foreseeability-focused analysis, City of Buffalo v. Hyundai Motor Am., Inc., 2025 WL 1721053, at *1 (9th Cir. June 20, 2025), but certified this question under New York law: "Did the Manufacturers owe the New York Municipalities a duty to exercise reasonable care in the design, manufacture, and distribution of their vehicles?" Buffalo, 140 F.4th at 1251.
The majority observed that the cities' "novel negligence claims implicate substantial and potentially broad-reaching policy considerations." Id. at 1256. It left New York's highest court to address whether the case is "resolved by the rule that a 'defendant generally has no duty to control the conduct of third persons so as to prevent them from harming others.'" Id. at 1255. (quoting Hamilton v. Beretta U.S.A. Corp., 727 N.Y.S.2d 7 (2001)). In Hamilton, the court held that gun manufacturers did not owe a duty to relatives of victims of gun crimes. The Ninth Circuit noted that, like Hamilton, the car theft case "involved manufacturers and plaintiffs who were not the end users of the manufacturers' products" and "weighty policy considerations that determine whether a duty exists." Buffalo, 140 F.4th at 1254-55. The court also identified several differences between Hamilton and Buffalo that the New York court might consider, including that Buffalo, unlike Hamilton, involves an alleged product defect. Id. at 1254-56.
New York's Court of Appeals will now decide whether and how to address the certified question, which could involve additional party and amicus briefing.
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