Used Car Dealership Wins Nearly $10 Million Against Hyundai After Court Finds Automaker Destroyed Evidence and Lied

If you’ve ever felt like a little guy was being crushed by a big company, this is for you. Because a used car dealership in Pittsburgh walked away with nearly $10 million after a judge in Pennsylvania told Hyundai Motor America to sit back and think about what it was doing.

Knight Motors and its sister company, Doman Auto & Marine Sales, purchased 628 used Hyundai Sonatas (model years 2011–2014) at auction between early 2018 and mid-2019 — both outside Pittsburgh and both owned by the same person. And these weren’t random pieces; they were part of a major recall involving Hyundai’s notoriously problematic Theta II engines, affecting more than 1.6 million Hyundai and Kia vehicles. Dealers did exactly what the recall process allowed: they brought the cars to Hyundai’s own franchised dealers for engine replacement or buyback.

It’s completely legal. It totally makes sense. In fact, it is American capitalism at its best; We’ll come back to this in a moment.

Instead of honoring its recall obligations as any responsible automaker would, Hyundai apparently sifted through the volume of claims from Knight and its peers, decided something smelled fishy, ​​and issued what the judge later called a “stunning decision” in May 2019 to dismiss every single claim tied to Knight Motors all at once; No details or individual reviews were given. Hyundai internally referred to Knight and similar dealerships as the “Frequent Buyback Club” and “repeat offenders” and took steps to reduce or deny their payments.

Then, in a bold move that can only be described as extremely confident for someone who was about to be caught, Hyundai sued dealers for fraud in 2019 after paying more than $5 million in buybacks.

Allegheny County Common Pleas Court Judge Philip Ignelzi had been on the job for 16 years when this case was tried. In the end, he said, Hyundai’s behavior was one of the most egregious examples of evidence destruction and courtroom misconduct he had seen in all his years. That’s a remarkable thing to say about a major automaker.

What exactly did Hyundai do? First reported by Automotive News, the court found that the company crushed hundreds of recalled vehicles — the vehicles at the center of the case — effectively destroying key physical evidence. Emails from the Hyundai case manager were also deleted. The judge called this “rampant looting,” the legal term for destroying evidence and is generally considered a very bad look in court.