This article has multiple issues. Please help improve it or discuss these issues on the talk page . (Learn how and when to remove these messages)
|
Grimshaw v. Ford Motor Co. | |
---|---|
Court | Court of Appeals of California, Fourth Appellate District, Division Two |
Full case name | RICHARD GRIMSHAW, a Minor, etc., Plaintiff and Appellant, v. FORD MOTOR COMPANY, Defendant and Appellant; CARMEN GRAY, a Minor, etc., et al., Plaintiffs and Appellants, v. FORD MOTOR COMPANY, Defendant and Appellant |
Decided | May 29, 1981 |
Citation | 119 Cal.App.3d 757 |
Court membership | |
Judges sitting | Tamura (Acting P.J.) McDaniel · Kaufman |
Case opinions | |
Decision by | Tamura, joined by McDaniel |
Concurrence | Kaufman |
Grimshaw v. Ford Motor Company (119 Cal.App.3d 757, 174 Cal.Rptr. 348) was a personal injury tort case decided in Orange County, California in February 1978 and affirmed by a California appellate court in May 1981. The lawsuit involved the safety of the design of the Ford Pinto automobile, manufactured by the Ford Motor Company. The jury awarded plaintiffs $127.8 million in damages, the largest ever in US product liability and personal injury cases. Grimshaw v. Ford Motor Company was one of the most widely publicized of the more than a hundred lawsuits brought against Ford in connection with rear-end accidents in the Pinto. [1] The trial judge reduced the jury's punitive damages award to $3.5 million.
On appeal, Ford contested the trial court judgement on the basis of errors, and contested the punitive damages award on the grounds of an absence of malice and that the punitive damages award was not authorized by statute and was unconstitutional. The appellate court affirmed the trial court. [2]
A 1972 Pinto rear-end impact and fire in San Bernardino, California, resulted in the death of the driver Lilly Gray and severe injury to passenger Richard Grimshaw. Gray's family and Grimshaw filed separate suits against Ford, but the actions were consolidated for trial. The jury awarded $127.8 million in damages; $125 million in punitive damages, and $2,841,000 in compensatory damages to Grimshaw and $665,000 in compensatory damages to the Gray family. The jury award was the largest ever in US product liability and personal injury cases. [3] [4] [5] The jury award was the largest against an automaker until a $150 million verdict in a 1996 case, Hardy vs. General Motors. [6]
The judge reduced the jury's punitive damages award to $3.5 million, which he later said was "still larger than any other punitive damage award in the state by a factor of about five." [5]
University of California Los Angeles law professor Gary T. Schwartz, writing in 1990, said that the jury verdict was plausible, and that the "core of the Pinto story" was:
Given this description of the Pinto's design problem, some comments can be offered on the decision-making process within Ford that resulted in the Pinto. As shown above, a famous Ford report cannot be interpreted as showing Ford balancing lives against dollars in designing the Pinto. To state that the report does not itself reveal such a process does not mean, however, that such a process did not take place. Accordingly, I have consulted the Grimshaw record to learn what light it sheds on this question. As far as basic gas tank location is concerned, I am persuaded that the trunk capacity problem, in conjunction with American auto custom, provides the best explanation for Ford's choice to place the Pinto gas tank behind the axle. As for additional design proposals brought forward by the plaintiffs, several of them-for example, a bladder within the gas tank, and a "tank within the tank"-concerned somewhat innovative technology that had never been utilized in actual auto production. At trial, there was testimony that a bladder would have been feasible in the early 1970's, but also rebuttal testimony that a bladder was at this time beyond the bounds of feasibility. The jury's general verdict does not reveal whether and how the jury resolved such conflicts in the evidence; and I am in no position to resolve them here. Consider now, however, the combination of a stronger bumper, a smooth (bolt-free) differential, and the addition of both hat sections and horizontal cross-members. This combination of design changes clearly would have improved the Pinto's safety to some appreciable extent. According to the evidence, the overall cost of this combination would have been $9; and it makes sense to assume that these items were turned down by Ford in planning the Pinto primarily on account of their monetary costs. It is plausible to believe, then, that because of these costs, Ford decided not to improve the Pinto's design, knowing that its decision would increase the chances of the loss of consumer life. Once a variety of misconceptions are stripped away, this limited core of the Pinto story remains. And this is a core that may well be strong enough to support the "myth" of the Ford Pinto case in the second of the meanings described above. What follows is my effort to explicate the elements of that myth. [2]
According to the Los Angeles Times in 2010, the award "signalled to the auto industry that it would be harshly sanctioned for ignoring known defects." [7]
In discussing the appellate court findings of fact Schwartz (1990) notes that the appellate court was under strict rules of interpretation. He states:
For reasons quite beyond the court's control, its opinion must be treated cautiously as a source of actual facts. Because the defendant was appealing a jury verdict in favor of the plaintiffs, the court was under an obligation to view all the evidence in a way most favorable to the plaintiffs and essentially to ignore evidence in the record that might be favorable to the defendant. See id. at 773, 820, 174 Cal. Rptr. at 359, 388. In fact, Ford's basic position at trial-which the court's opinion at no point mentions-was that the approaching car (a Ford Galaxie) had not slowed down at all, and had struck the Gray car at a speed in excess of 50 miles per hour. There was an enormous amount of evidence at trial supporting each of the parties' factual claims as to the Galaxie's closing speed. Had the jury accepted Ford's speed estimate, there would not have been much of an issue of crashworthiness: for the plaintiffs' position throughout trial was that even a state-of-the-art fuel system could not maintain integrity in a 50 mile-per hour collision. [2]
The trial court's findings of fact regarding the accident, the design of the Pinto, Ford's crash testing, and Ford's cost benefit analysis were not contested on appeal, and were accepted by the appellate court "in accordance with established principles of appellate review." [8]
A 1972 Ford Pinto hatchback stalled on a freeway, erupting into flames when it was rear-ended by a Ford Galaxie proceeding in the same direction. Lilly Gray, the driver of the Pinto, suffered severe burns to her entire body and resulted in her death by congestive heart failure on her way to the hospital. 13-year-old Richard Grimshaw, a passenger, suffered severe, permanently disfiguring burns to his entire body. Grimshaw underwent numerous skin grafts and extensive surgeries, but still lost portions of the fingers on his left hand and his left ear in the accident. Doctors estimated that Grimshaw would require many more surgeries within the next 10 years.
The plaintiff's expert testified that the Pinto's gas tank was pushed forward upon impact and punctured by a flange or bolt on the differential housing. Fuel sprayed from the tank and entered the passenger compartment through the gaps between the rear wheel wells and the floor.
In 1968, Ford began designing the subcompact car that would eventually become known as the Pinto.
The courts found that Lee Iacocca, at the time a vice president at Ford, conceived the Pinto "project and was its moving force" and said that "Ford's objective was to build a car at or below 2,000 pounds to sell for no more than $2,000." [9] The courts described the Pinto as a "rush project," and said that while standard automotive industry practice was that "engineering studies precede the styling," in the case of the Pinto project "styling preceded engineering and dictated engineering design to a greater degree than usual." [10]
The court found that the Pinto's styling required the gas tank to be placed behind the rear axle, instead of over the rear axle as was "the preferred practice in Europe and Japan" and that the Pinto had "only 9 or 10 inches" of "crush space," "far less than in any other American automobile or Ford overseas subcompact." [11] The court found that the Pinto's bumper "was little more than a chrome strip, less substantial than the bumper of any other American car produced then or later." [12] The court found that the Pinto's rear structure lacked reinforcement "found in all automobiles produced by Ford's overseas operations," rendering the Pinto "less crush resistant than other vehicles." [13] The court found that a flange and a line of bolts on the Pinto's differential housing "were sufficient to puncture a gas tank driven forward upon rear impact." [14]
Ford tested two production models of the Pinto and prototypes, some of which "were true duplicates of the design car," "to determine, among other things, the integrity of the fuel system in rear-end accidents." [15] Proposed federal regulations required impacts "without significant fuel spillage," up to 20 miles per hour (32 km/h) impacts by 1972 and 30 miles per hour (48 km/h) by 1973. [16]
Crash tests proved that the Pinto could not meet the proposed regulations. A collision from the rear "caused the fuel tank to be driven forward and to be punctured, causing fuel leakage." A collision of a production Pinto "caused the fuel neck to be torn from the gas tank and the tank to be punctured by a bolt head on the differential housing." In at least one test collision "spilled fuel entered the driver's compartment through gaps resulting from the separation of the seams joining the rear wheel wells to the floor pan," separations due in part to "the lack of reinforcement in the rear structure." [17]
Ford tested modified Pinto prototypes, which "proved safe at speeds at which the Pinto failed," including modifications to line the fuel tank with a rubber bladder, to locate the fuel tank above rather than behind the rear axle, and to add reinforcement. [18]
The courts found that, while "the standard of care for engineers in the industry" after a failed safety test was to "redesign and retest," and although fixes were inexpensive, "Ford produced and sold the Pinto to the public without doing anything to remedy the defects." [19]
Design changes that would have enhanced the fuel system at very little cost included: [20]
Equipping the car with a reinforced rear structure, smooth axle, improved bumper and additional crush space at a total cost of $15.30 would have made the fuel tank safe in a 34 to 38-mile-per-hour rear-end collision by a vehicle the size of the Ford Galaxie. If, in addition to the foregoing, a bladder or tank within a tank were used or if the tank were protected with a shield, it would have been safe in a 40 to 45-mile-per-hour rear impact. If the tank had been located over the rear axle, it would have been safe in a rear impact at 50 miles per hour or more. [21]
The Pinto project team held regular product review meetings chaired and attended by Ford vice presidents. The Pinto was approved by Ford's Product Planning Committee, which included Iacocca and other Ford vice presidents. [22] At an April, 1971 product review meeting, a report prepared by Ford engineers entitled "Fuel System Integrity Program Financial Review" was distributed and discussed, which referred to the crash tests of Ford vehicles and estimated the financial impact of design changes to comply with the proposed federal fuel system integrity standards. The report recommended deferring fixes in order to accrue cost savings. [23] Harley Copp, a former Ford engineer and the executive in charge of the crash testing program, "testified that the highest level of Ford's management made the decision to go forward with the production of the Pinto, knowing that the gas tank was vulnerable to puncture and rupture at low rear impact speeds creating a significant risk of death or injury from fire and knowing that 'fixes' were feasible at nominal cost." [21]
The appellate court affirmed the trial court.
Ford contested the trial court judgement on the basis of errors, and contested the punitive damages award on the grounds of an absence of malice and that the punitive damages award was not authorized by statute and was unconstitutional.
The appellate court "concluded that Ford has failed to demonstrate that any errors or irregularities occurred during the trial which resulted in a miscarriage of justice requiring reversal." [21]
Ford contended that the trial court erroneously admitted Ford's "Fuel System Integrity Program Financial Review" report as irrelevant and prejudicial. In the document, Ford engineers recommending deferring the installation of "flak suits" or "bladders," available at a cost of $4 to $8 per car, in all Ford cars to 1976, which allowed the company to realize a savings of $20.9 million. [23] The appellate court ruled that the report was highly relevant in that "A reasonable inference may be drawn from the evidence that despite management's knowledge that the Pinto's fuel system could be made safe at a cost of but $4 to $8 per car, it decided to defer corrective measures to save money and enhance profits." [24]
Ford contended the punitive damages on two grounds: 1) punitive damages are statutorily and constitutionally impermissible in design defect cases; and 2) there was no evidentiary support for a finding of malice or corporate responsibility for malice.
The appellate court found no statutory impediments to punitive damages and said that "Ford's contention that the statute is unconstitutional has been repeatedly rejected." [21]
Ford contended that the "Exemplary damages" section of California's civil code [25] required an "evil motive," or an intent to injure the person harmed, for punitive damages, and argued absence of malice. The appellate court cited precedent that "malice" as used in California's "Exemplary damages" code included "not only a malicious intention to injure the specific person harmed, but conduct evincing 'a conscious disregard of the probability that the actor's conduct will result in injury to others.'" [26] In Taylor v. Superior Court, the California Superior Court held that a conscious disregard of the safety of others is sufficient to meet the animus malus required for punitive damages awards, adding: "In order to justify an award of punitive damages on this basis, the plaintiff must establish that the defendant was aware of the probable dangerous consequences of his conduct, and that he wilfully and deliberately failed to avoid those consequences." In a commercial context, the imposition of punitive damages deters the furtherance of "objectional corporate policies" and encourages the remedy of safety concerns that might otherwise go unchecked. [27] [28] [29]
According to the appellate court decision,
There was ample evidence to support a finding of malice and Ford's responsibility for malice. Through the results of the crash tests Ford knew that the Pinto's fuel tank and rear structure would expose consumers to serious injury or death in a 20- to 30-mile-per-hour collision. There was evidence that Ford could have corrected the hazardous design defects at minimal cost but decided to defer correction of the shortcomings by engaging in a cost-benefit analysis balancing human lives and limbs against corporate profits. Ford's institutional mentality was shown to be one of callous indifference to public safety. There was substantial evidence that Ford's conduct constituted "conscious disregard" of the probability of injury to members of the consuming public...There is substantial evidence that management was aware of the crash tests showing the vulnerability of the Pinto's fuel tank to rupture at low speed rear impacts with consequent significant risk of injury or death of the occupants by fire. There was testimony from several sources that the test results were forwarded up the chain of command;...While much of the evidence was necessarily circumstantial, there was substantial evidence from which the jury could reasonably find that Ford's management decided to proceed with the production of the Pinto with knowledge of test results revealing design defects which rendered the fuel tank extremely vulnerable on rear impact at low speeds and endangered the safety and lives of the occupants. Such conduct constitutes corporate malice. [21]
Ford argued that the amount awarded in punitive damages was excessive. The test for deciding whether the amount was excessive as a matter of law or was so grossly disproportionate as to raise the presumption that it was the product of passion or prejudice is four-prong: 1) the degree of reprehensibility of defendant's conduct; 2) wealth of the defendant; 3) the amount of compensatory damages; and 4) an amount which would serve as a deterrent effect on like conduct by the defendant and others. The appellate court held that
...the conduct of Ford's management was reprehensible in the extreme. It exhibited a conscious and callous disregard of public safety in order to maximize corporate profits...Ford's tortious conduct endangered the lives of thousands of Pinto purchasers. Weighed against the factor of reprehensibility, the punitive damage award as reduced by the trial judge was not excessive." [21]
In light of Ford's 7.7 billion dollar net worth and 983 million dollar income after taxes in 1976, the court found that the punitive award was approximately 0.005% of Ford's net worth and 0.03% of its income. The ratio of punitive damages to compensatory damages was approximately 1.4:1. Significantly, Ford did not argue about the excessiveness of the compensatory damages. Lastly, the punitive award was sufficient to require Ford to take notice, rather than allowing the company to write it off as a mere business expense.
Grimshaw appeals from the order granting a conditional new trial and from the amended judgment entered pursuant to the order. Grimshaw argues that 1) the punitive damages awarded by the jury where not excessive as a matter of law; 2) the specification of reasons was inadequate; and 3) the court abused its discretion in cutting the award so drastically. The appellate court held that the trial court did not err in reducing the jury's award of punitive damages from more than 122 million to 3.5 million or in granting a new trial for excessive damages. There was no evidence showing that the trial judge abused his discretion, nor that he acted in any way that was not fair and reasonable under the circumstances.
Punitive damages, or exemplary damages, are damages assessed in order to punish the defendant for outrageous conduct and/or to reform or deter the defendant and others from engaging in conduct similar to that which formed the basis of the lawsuit. Although the purpose of punitive damages is not to compensate the plaintiff, the plaintiff will receive all or some of the punitive damages in award.
The Ford Pinto is a subcompact car that was manufactured and marketed by Ford Motor Company in North America from 1970 until 1980. The Pinto was the first subcompact vehicle produced by Ford in North America.
The Reliant Scimitar name was used for a series of sports car models produced by British car manufacturer Reliant between 1964 and 1986. During its 22-year production it evolved from a coupe (GT) into a sports estate (GTE), with a convertible variant (GTC) launched in 1980. All have a fibreglass body mounted on a steel box-section chassis, and Ford engines.
A four-wheel drive, also called 4×4 or 4WD, is a two-axled vehicle drivetrain capable of providing torque to all of its wheels simultaneously. It may be full-time or on-demand, and is typically linked via a transfer case providing an additional output drive shaft and, in many instances, additional gear ranges.
Class Action is a 1991 American legal drama film directed by Michael Apted. Gene Hackman and Mary Elizabeth Mastrantonio star; Larry Fishburne, Colin Friels, Fred Dalton Thompson, and Donald Moffat are also featured. The film was entered into the 17th Moscow International Film Festival.
Gertz v. Robert Welch, Inc., 418 U.S. 323 (1974), was a landmark decision of the US Supreme Court establishing the standard of First Amendment protection against defamation claims brought by private individuals. The Court held that, so long as they do not impose liability without fault, states are free to establish their own standards of liability for defamatory statements made about private individuals. However, the Court also ruled that if the state standard is lower than actual malice, the standard applying to public figures, then only actual damages may be awarded.
The Chevrolet Vega is a subcompact automobile that was manufactured and marketed by GM's Chevrolet division from 1970 to 1977. Available in two-door hatchback, notchback, wagon, and sedan delivery body styles, all models were powered by an inline four-cylinder engine designed specifically for the Vega, with a lightweight, aluminum alloy cylinder block. The Vega first went on sale in Chevrolet dealerships on September 10, 1970. Variants included the Cosworth Vega, a short-lived limited-production performance model, introduced in the spring of 1975.
The Chevrolet Engineering Research Vehicle (CERV) is a series of Chevrolet experimental cars. Chevrolet Staff engineer, designer, and race car driver Zora Arkus-Duntov started development of the CERV I in 1959, and began work on the CERV II in 1963. Chevrolet chief engineer Don Runkle and Lotus' Tony Rudd discussed creating a new show car to demonstrate their engineering expertise in 1985; It would become the CERV III. Corvette chief engineer Dave Hill unveiled the CERV IV in 1993, a test vehicle for the 1997 C5 Corvette.
Tort reform consists of changes in the civil justice system in common law countries that aim to reduce the ability of plaintiffs to bring tort litigation or to reduce damages they can receive. Such changes are generally justified under the grounds that litigation is an inefficient means to compensate plaintiffs; that tort law permits frivolous or otherwise undesirable litigation to crowd the court system; or that the fear of litigation can serve to curtail innovation, raise the cost of consumer goods or insurance premiums for suppliers of services, and increase legal costs for businesses. Tort reform has primarily been prominent in common law jurisdictions, where criticism of judge-made rules regarding tort actions manifests in calls for statutory reform by the legislature.
The Ford Motor Company is an American automaker, the world's fifth largest based on worldwide vehicle sales. Based in Dearborn, Michigan, a suburb of Detroit, it was founded by Henry Ford on June 16, 1903. Ford Motor Company would go on to become one of the largest and most profitable companies in the world. The largest family-controlled company in the world, the Ford Motor Company has been in continuous family control for over 110 years. Ford now encompasses two brands: Ford and Lincoln. Ford once owned 5 other luxury brands: Volvo, Land Rover, Jaguar, Aston Martin, and Mercury. Over time, those brands were sold to other companies and Mercury was discontinued.
Dun & Bradstreet, Inc. v. Greenmoss Builders, Inc., 472 U.S. 749 (1985), was a Supreme Court case which held that a credit reporting agency could be liable in defamation if it carelessly relayed false information that a business had declared bankruptcy when in fact it had not.
The fifth-generation Ford Mustang, is a two-door four-seater pony car manufactured and marketed by Ford from 2004 to 2014, for the 2005 to 2014 model years — carrying the internal designation S197 and marketed in coupe and convertible body styles. Assembly took place at the Flat Rock Assembly Plant in Flat Rock, Michigan. The fifth generation began with 2005 model year, and received a facelift for the 2010 model year.
When a person makes a claim for personal injury damages that have resulted from the presence of a defective automobile or component of an automobile, that person asserts a product liability claim. That claim may be against the automobile's manufacturer, the manufacturer of a component part or system, or both, as well as potentially being raised against companies that distributed, sold or installed the part or system that is alleged to be defective.
Carol Burnett v. National Enquirer, Inc. was a decision by the California Court of Appeal, which ruled that the "actual malice" required under California law for imposition of punitive damages is distinct from the "actual malice" required by New York Times Co. v. Sullivan to be liable for defaming a "public figure", and that the National Enquirer is not a "newspaper" for the purposes of California libel law.
The V8SuperTourers Championship was a motor racing series in New Zealand which started in 2012 and folded in 2015. The cars were then absorbed into the NZ Touring Cars championship.
The Jacksonville, Maryland, ExxonMobil gas leak case is a series of lawsuits against ExxonMobil as a result of a February 2006 underground gasoline leak from an ExxonMobil service station in Jacksonville, Maryland.
Harte-Hanks Communications Inc. v. Connaughton, 491 U.S. 657 (1989), was a case in which the Supreme Court of the United States supplied an additional journalistic behavior that constitutes actual malice as first discussed in New York Times Co. v. Sullivan (1964). In the case, the Court held that departure from responsible reporting and unreasonable reporting conduct alone were not sufficient to award a public figure damages in a libel case. However, the Court also ruled that if reporters wrote with reckless disregard for the truth, which included ignoring obvious sources for their report, plaintiffs could be awarded compensatory damages on the grounds of actual malice.
McGee v. General Motors was a 1998 court case in which the jury awarded plaintiffs Robert and Connie McGee $60 million. The trial revealed hidden information about a General Motors fuel tank design. General Motors (GM) was alleged to have sacrificed vehicle safety measures in favor of additional profit. This case was featured on CNN, 60 Minutes, The New York Times, and USA Today.
The Ford Fiesta Mk1 is the first generation of the Ford Fiesta supermini. It was introduced in 1976 as Ford Europe's first multi-national front-wheel-drive automobile, and was available in both 3-door hatchback and panel van derivatives. In 1983, the Fiesta was updated, and the Fiesta Mk2 was introduced.
The third generation of theC/K series is a range of trucks that was manufactured by General Motors from the 1973 to 1991 model years. Serving as the replacement for the "Action Line" C/K trucks, GM designated the generation under "Rounded Line" moniker. Again offered as a two-door pickup truck and chassis cab, the Rounded Line trucks marked the introduction of a four-door cab configuration.