Theta II engine failures: class settlement isn't always the answer

What the Theta II class settlement covered

The Theta II 2.0L and 2.4L gasoline direct-injection engines, used across Hyundai Sonata, Santa Fe, Tucson and Kia Optima, Sorento, Sportage models manufactured roughly 2011 through 2019, have been subject to multiple recalls related to engine seizure and connecting-rod-bearing failure. In 2020, Hyundai and Kia agreed to a class settlement covering certain consumer claims arising from these defects.

The settlement provides a number of remedies including extended warranty coverage for the Theta II engine, reimbursement for past repairs under specific conditions, compensation for vehicles repossessed or sold due to engine failure, and other consumer protections.

What the class settlement did NOT cover

Several common scenarios fall outside the class settlement and remain potential individual claims:

• Vehicles outside the covered model years. Theta II engine failures have been reported in vehicles outside the class definition. If your vehicle is on the periphery of the covered list — or omitted entirely — you may have individual claims under MMWA and state lemon law.
• Failures that occurred outside the class's defined defect criteria. The class settlement defines specific defect patterns. Failures that don't fit those patterns may not be covered by the class — but may still be cognizable under MMWA.
• Diminished-value claims. A vehicle that has had a Theta II engine replaced under warranty still carries a stigma and a resale-value reduction. The class settlement does not generally compensate for diminished value as a primary remedy.
• Consequential damages. Rental-car expenses, lost wages from breakdowns, and other consequential costs may not be fully addressed by class remedies.
• Opt-outs. Some consumers properly opted out of the class settlement to preserve individual claims.

Why MMWA can still apply

The Magnuson-Moss Warranty Act is a federal statute that operates independently of state lemon laws and class settlements. If your vehicle came with a written warranty and the manufacturer has failed to repair a defect after a reasonable number of attempts, MMWA applies — regardless of whether you participated in a class settlement, unless you specifically released your MMWA claim as part of that settlement.

Most Theta II class participants did NOT release individual MMWA claims for defects other than the engine-seizure pattern specifically addressed by the class. This means a class participant whose Theta II vehicle subsequently has a different defect — say, a transmission failure or an HVAC defect — retains full rights under MMWA for that separate defect.

How to evaluate your situation

Three questions matter:

1. Did you opt in or out of the class settlement? If you don't know, the settlement administrator's records can tell you. Opting out generally preserves individual MMWA claims; opting in releases certain claims as defined by the settlement.
2. Is your current defect addressed by the class? If your engine failure pattern matches the class definition exactly, the class remedies are likely your path. If your defect is materially different — or your vehicle is materially different from the class — MMWA may be a viable independent path.
3. Has the manufacturer had a reasonable opportunity to fix? MMWA requires the manufacturer to have a reasonable opportunity to repair the defect. "Reasonable" is a fact-specific determination, but two or three failed repair attempts on the same defect is generally sufficient.

If you own a Hyundai or Kia with engine issues and you're unsure whether the class settlement, MMWA, or both apply to your situation, take our case quiz. We will tell you on the intake call which path makes sense.