Product Liability Through the Eyes of Ford Motor

OUTLINE:

1. Introduction

a. Opening statement

b. Transitional theory

2. Product Liability

a. Define Product Liability

b. Elements of Product Liability

3. National Highway Traffic Safety Administration (NHTSA)

a. History of the NHTSA

b. NHTSA complaint and recall process defined

4. Ford Motor Company's Product Liability of the Past

a. Product safety issue with leaking gasoline tank

b. Case Example

5. Ford Motor Company's Product Liability in the Present

a. Product safety issue with unwanted airbag deployment

b. Case Example

6. Ford Motor Company's response to unwanted airbag deployments

a. Decision

b. Result

7. Conclusion

a. Product liability redefined

b. Ford Motor Company's responsibility and road to recovery

Product Liability Through the Eyes of Ford Motor Co.

Imagine driving what the carmakers claim to be a safe vehicle in bumper-to-bumper traffic or through a school-zone full of children. Most drivers assume the safety of their vehicles is without question; however, the truth could not be further from reality. From exploding gasoline tanks to the unwanted deployment of frontal airbags, bodily injuries from Ford Motor Company's vehicles have been in the media forefront due to product liability issues since the 1970's. What liability, if any, should the manufacturer incur for such occurrences? First, the author will explore the product liability portion of tort law, elements thereof, and what the United States Government enacted to ensure consumer safety. Furthermore, she will investigate the manufacturer's history when they knowingly continued to sell defective vehicles, without warning current and potential consumers for days, weeks, and months after the first unfortunate accident occurred. Then, the author will follow Ford's response to present-day safety issues with one of their best-selling pickup trucks and potential for unwanted airbag deployment. In the following pages, she shall show how both the regulating agencies and consumers held automotive giant accountable, and yet, Ford Motor Company prevails as a leading American automobile manufacturer.

In order to understand why the recovery of an automotive giant, Ford Motor Co., took the tenacity of many people, individuals must understand product liability and the different elements within this tort law. According to The Handy Law Answer Book: Understanding the Law Navigating the Legal System:

"Products liability refers to the area of tort law holding manufacturers, sellers, and suppliers of products liable for injuries caused by their products. Products liability actions arise when a product is defective and causes injury or harm to a user or consumer of that product. Products liability actions can be brought under a variety of legal theories, including negligence, strict liability, and breach of warranty. Product liability cases fall into the following categories proper design, manufacturer defect, and failure to warn (Hudson, 2010).

By law, companies have a duty to warn the consumer should their product contain issues or designs, which may have the potential or contain risks for injury associated with said products. One agency responsible for ensuring manufacturers and sellers remain accountable for product liability of their products is the National Highway Transportation Safety Administration.

The National Traffic and Motor Vehicle Safety Act, enacted in 1966 and recodified as 49 U.S.C Chapter 301, gave the Department of Transportation's National Highway Traffic and Safety Administration (NHTSA) the authority to issue safety standards and require manufacturers to recall vehicles failing to either meet the standards or have safety-related defects (National Highway Transportation Safety Administration, 2011). Established in 1970, the NHTSA directs the highway safety and consumer programs and ensures high standards of excellence in motor vehicle and highway safety (National Highway Transportation Safety Administration, 2011). To enforce quality, the NHTSA has a consumer complaint system instilled within their Office of Defects Investigation (ODI), which conducts the product defect investigations and potential administering of safety recalls. The first step to a recall, and most important in the author's opinion, is the complaint filed by the consumer. Consumers may file their grievance online through the NHTSA website, https://www-odi.nhtsa.dot.gov/ivoq , request a complaint form through their email, contact the NHTSA Hotline, or mail a complaint letter directly into the ODI (National Highway Transportation Safety Administration, 2011). After receiving the form, the ODI enters the information into a vehicle owner's complaint database and analyzes the information to determine whether a safety-related defect exists. To guarantee thoroughness, ODI insists they do not have to receive a specific number of complaints in order to find safety-related fault with a manufacturer; they have analysts review every grievance. If the ODI finds plausible cause, they will open an investigation to determine a trend, which may or may not result in issuing a recall for a certain make, model, year, or a combination of the three (National Highway Transportation Safety Administration, 2011). If the ODI finds cause for a recall, the NHTSA demands manufacturers report such product defects in a timely manner, which if not complied with, carries heavy fines. One such company, Toyota Motor Corporation, Inc. had not reported a sudden unintended acceleration (SUA) defect with several of their Prius, Scion and Lexus models for over four months (Piscitelli, 2010). For this failure to notify consumers or the NHTSA of the SUA defects, on April19, 2010, the administration imposed the largest fine permitted by law of $16.375 million and the largest civil penalty imposed upon an automobile manufacturer, Toyota Motor Corp., to-date (Piscitelli, 2010). In addition to this April fine, Toyota agreed to pay an additional $16.050 million in civil penalties also due to their failure