Lawsuit settlement against Kia, Hyundai includes option to get anti-theft device from Minneapolis startup firm

A Minneapolis startup that last year debuted car-tracking tags to help police find and recover stolen vehicles is bracing for an uptick in sales now that owners of certain models of Kia and Hyundai vehicles can buy one of the devices and get reimbursed.

TC Nighthawks on Monday was already getting calls and emails from people inquiring how to get one of the GPS-equipped tags and take advantage of the benefit outlined in the $200 million settlement of a class-action lawsuit against the Korean automakers.

Notices about the settlement and how to recoup money for out-of-pocket expenses related to thefts and attempted thefts were to be delivered by mail and email this week, the settlement said.

“We are honored to be part of the solution,” said Lacey Gauthier, who launched TC Nighthawks after a rash of car thefts in her south Minneapolis neighborhood.

A Seattle-based law firm filed the suit in August 2022 on behalf of about 9 million people who bought or leased Kia or Hyundai vehicles manufactured between 2011 and 2022. The suit contended the companies failed to install engine immobilizers in some models that featured a traditional insert-and turn-key-style ignition system, leaving vehicles vulnerable to theft.

Kia and some Hyundai vehicles have been popular targets for thefts nationwide. Coined “The Kia Challenge,” videos online exposed the vehicles’ defects and showed how simple it is to start them without a key and drive them away.

Immobilizers prevent most vehicles from starting unless a code is transmitted from the vehicle’s smart key, according to Hagens Berman, the law firm that filed the suit.

A California court approved a preliminary settlement last fall that calls for the companies to provide free software upgrades that will prevent vehicles from starting when a key or key fob is not present. For vehicles not eligible for software upgrades, the settlement allots up to $300 per vehicle to cover owners’ costs of buying a wheel lock, glass-breakage alarm or anti-theft system. TC Nighthawks sells its tags for $299, meeting the price point for reimbursement as outlined in the suit, Gauthier said.

A final settlement approval is set for July 15 in a California court. Payments will be made after any appeals are resolved, the law firm said.

TC Nighthawks’ tags use GPS, Bluetooth and satellite technology to locate vehicles. If a car with a tag is stolen, the victim can report it to police, get a case number and immediately call TC Nighthawks. With an app developed in-house, a Nighthawks dispatcher tracks and follows along with police dispatch. That helps police zero in on the vehicle and improves the odds of recovery.

In addition, Nighthawks has a team of specialists who operate drones with cameras to capture footage that could identify suspects and give police a look at what they might encounter when arriving on the scene.

In response to the thefts, Kia donated free steering wheel locks to some police departments to distribute, but thefts continued and prompted the lawsuit.

“If you are a single-car family, that is a huge loss,” said Nighthawks team member and former police detective Jim Thorburn.

With its motto “We’ll keep one eye open … so you can close both of yours,” Nighthawks has grown from a tiny staff to a team of 60, including technology experts, security specialists and former police detectives. Nighthawks also has 3,900 drone pilots nationwide where it offers its services.

Nighthawks declined to give sales figures, but says the company is up “5,000%” since it sold its first two units last March. The company is expecting to get a lot more orders with the reimbursement option now on the table, and since it has expanded operations beyond the Twin Cities.

“We are bringing new technology to an old problem,” Gauthier said. “We are not trying to be the police. We are trying to get cars back to the family.”