PASADENA — Kia and Hyundai must face a class action lawsuit lodged by insurers asserting the car makers must pay to cover at least hundreds of millions of dollars in losses suffered by insurers amid a years-long auto theft rampage targeting Kia and Hyundai vehicles that the insurers and other plaintiffs have claimed the companies made too easy for criminals to steal.
On Sept. 14, a three-judge panel of the U.S. Ninth Circuit Court of Appeals revived the lawsuits lodged against the Korean automakers by about 200 insurance companies.
In the decision, the Ninth Circuit judges said a Los Angeles federal district court judge was wrong to dismiss the insurers' lawsuit after finding the South Korea-based companies did nothing more than sell cars that happened to be purchased by consumers in the U.S, and in California, particularly.
So, U.S. District Judge James V. Selna ruled in 2025 that the insurers couldn't sue Kia and Hyundai in courts in California.
On appeal, the Ninth Circuit judges, rather, said it was clear that Kia and Hyundai designed these particular cars to be sold in the U.S. and then intentionally shipped large numbers of those vehicles through California ports to be sold in California and elsewhere in the U.S.
That, they said, is enough for the federal courts in California to exercise jurisdiction over Kia and Hyundai and allow the insurers' lawsuit to proceed.
The Ninth Circuit decision was authored by Judge Eric D. Miller. Judges Kim McLane Wardlaw and Marsha S. Berzon concurred in the ruling.
"Here, ... the shipping records show that more than 70 percent of the vehicles the Korean entities shipped to the United States were shipped through California ports," Miller wrote. "It is therefore reasonable to infer that many of the allegedly defective vehicles at issue in this litigation were shipped to California ports before ending up in California, and thus that, as to those vehicles, plaintiffs’ 'claim[s] came about because of the defendant[s’] in-state conduct.'"
The decision comes as the latest step in a years-long court fight that has forced Kia and Hyundai to defend themselves on multiple fronts against a host of plaintiffs seeking to extract payment from the companies for car thefts committed by criminals in cities in California and other high-crime jurisdictions throughout the U.S.
The legal actions all center on the so-called "Kia Boyz" car theft surge since 2020.
So-called "Kia Boyz" car thieves used viral online TikTok video tutorials to exploit a flaw in a range of Kia and Hyundai vehicle models manufactured from 2011-2022. Those specific car models ordinarily relied on physical keys to start the vehicle.
Most other vehicles manufactured by other companies in that time frame included so-called engine immobilizer devices, which prevent a car’s engine from being started unless a driver uses a so-called “smart key,” embedded with a chip that sends a signal to deactivate the immobilizer.
However, most Kia and Hyundai models manufactured in that period did not include those immobilizers, which allowed thieves to hotwire the cars quickly and relatively easily, by removing a plastic cowl under the steering column and using a common USB cable to start the car.
Thieves often would then use the stolen vehicles for reckless and criminal behavior, often video recording themselves in the process, to generate views and likes on social media, or to engage in gang-related activity or armed robberies, among other crimes.
To this point, the Korean automakers have paid more than $200 million, at least, to settle some of those claims. Those include more than $145 million to settle class action lawsuits launched on behalf of private consumers, whose vehicles were stolen or damaged amid the surge in car thefts
However, the automakers continue to face a mass of other legal claims, potentially worth billions of dollars, in consolidated lawsuits still pending in Los Angeles federal court.
Among these are a host of lawsuits filed since 2023 by U.S. city and county governments from across the country. These include actions filed by the cities of New York, Chicago, Seattle, St. Louis and Milwaukee, where the "Kia Boyz" phenomenon originated.
All of those lawsuits assert Kia and Hyundai owe potentially billions of dollars to the cities to help the cities recover their costs allegedly associated with thefts of Kia and Hyundai automobiles in those cities, supposedly because Kia and Hyundai didn't do enough to prevent thieves from stealing the cars.
At the same time, insurers have also lodged their legal actions seeking payouts from the Korean automakers, as well. The insurers have lodged their lawsuits as subrogation actions, meaning they are seeking to make the automakers pay to cover the losses the insurers have already paid to the car owners whose vehicles were stolen or damaged by thieves.
Following the Ninth Circuit's ruling, the insurers will now be able to return to Judge Selna's courtroom and resume pursuing their claims.
