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Don't sue - as a lease you won't have much to stand on... It'll waste your time and money. Either try to get it totaled or just live with the repair and turn it in. This is really BMW's loss considering they've agreed on a residual value and that's now in jeopardy. You've been insulated from that loss in fact.
I'd try for a total... Short of that, just move on. The car will be OK if repaired correctly.
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