OK....My repair facility replaced the yaw rate sensor late last week as a result of the ETS light being on. Mechanic was enroute to get my ML320 inspected when the ETS light came back on. They went back to the shop and hooked it up and got a C1120 code. They replaced the yaw rate sensor again, with the thought that the sensor replaced last week was NFG. Well, they are still getting the C1120 code. All wiring back to the control unit is fine...they ran a continuity check and found no wiring issues. Any ideas why the code keeps coming up?

Hello sounds like you have a couple of problems first of all you said ETS lamp comes on? If thats the case C1120 code is for yaw rate fault stored in the Esp control unit. You said they replaced wheel speed sensors?
The ETS reads wheel speed sensors and stop lamp switch to regulate brake pressure to correct wheel spin on accel. Does the lamp flash,stay on all the time or go on then off ? There is a sequence for different faults.
Also some early MLs had issues with wiring loom at traction control unit at left front frame rail getting chaffed on mounting bracket causing some odd faults.
One more thing the main ground for the traction control unit is W9 and is located behind left headlamp theres a stud welded to body.Sometimes when techs install new auxillary fan harness kit they cant get nut loose and break the stud and just screw them with a sheet metal screw causing poor ground and setting faults. Tim

The tech mentioned the C1120 was a soft fault, which leads me to assume that the stored fault is the cause. How long does it take for a replaced yaw rate sensor to be "recognized" by the control unit, and the past faults cleared out? Is there a chance it could be a faulty control unit? I really want to get the problem fixed, as there have been several instances when driving the ML, that the brakes seem to nearly fully apply themselves at highway speed (60-70) causing the vehicle to jerk downward and to the left.

Are all 4 tires exactly the same circumference?
Has there been any alignment work done?

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Tires are all the same brand, circumferance, etc. They were all replaced at the same time, ~ 1-1/2 years ago. I do recall that the shop that performed the work (not the same shop as is doing the work now) also did an alignment that they couldn't get a perfect 100% alignment, although I can't recall exactly why.