This week, while heads were rolling out the doors of the RenCen (GM headquarters) in downtown Detroit, the Chief Counsel of the National Highway Traffic Safety Administration was laying down the law for defense lawyers at a Chicago legal conference.
Amid the presentations at the American Conference Institute’s 7th Annual Summit on Defending & Managing Automotive Product Liability Litigation devoted to defeating class-actions, the liability of autonomous cars and one of our personal faves –tire aging (with a shout-out to SRS’ Sean Kane!), was a warning from the government.
First, Chief Counsel O. Kevin Vincent lulled them with a feel-good “rah-rah-ree” paean to industry. And then, he made the hair on the back of their necks rise: A manufacturer’s obligation to report a defect within five days of its discovery is the law, and after a long hiatus from doing its job, NHTSA intended to take “an aggressive stance” in enforcing it.
The first offense line in the discovery of a defect was not the Office of Defects Investigation, Vincent said. It was the manufacturers themselves.
“We don’t have analysts, but your clients do. You all have ability to find these defects,” he said.
A manufacturer cannot delay a defect finding, while a safety problem meanders through an internal process involving multiple committees. It cannot hide its knowledge behind a wall of attorney work product and attorney-client privilege. It cannot wait until it’s gotten the supply chain ready to implement the recall.
And it better not wait until after it settles a plaintiff’s case for big bucks. The TREAD Act obligated NHTSA to “follow up on civil litigation that sends up red flags,” he said. And they’d be looking for signs of foot-dragging in large civil litigation settlements. Not right away, certainly. Civil actions take years, he said. (This gives the safety problem plenty of time to fester.) How much of a settlement was enough to catch NHTSA’s attention? Vincent wouldn’t name a figure. Continue reading