October 21, 2014
A jury in Marshall County, Texas found that Trinity Industries, a global manufacturer of highway safety equipment, defrauded the federal government in 2005, when it won approval for an energy-absorbing guardrail end terminal that featured design changes that saved the company $50,000 annually. In finding that Trinity had knowingly made a false claim to the government, the jury awarded the Federal Highway Administration and the Virginia guardrail competitor who brought the suit on behalf of the United States government $175 million.
The FHWA did not participate in the lawsuit, nor was it present in the courtroom.
Joshua Harman, the president of SPIG, sued Trinity under provisions of the False Claims Act, in which a private individual can sue federal contractors on behalf of the government, alleging fraud. Harman claims that sometime between 2002 and 2005, Trinity modified the design of its original guardrail end terminal design, the ET-Plus, causing it to fail in crashes and injure and kill occupants in striking vehicles. The newer versions of the ET-Plus, manufactured in 2005, bear a dimensional change to the width of the guide channel, or “feeder chute,” through which the rail is extruded. With this change, critics charge, the end terminal no longer performs like those of the earlier design. Instead of bending away, the rail jams in the chute, causing it to fold in half, forming a spear that can penetrate the striking vehicle. Harman has claimed that Trinity changed the design without notifying the FHWA, as required, until seven years later, when a patent dispute between the two companies brought this modification to light.
According to SRS staff who attended the trial, there were two keys to the plaintiffs’ success – a November 9, 2004 email and the testimony of Trinity President Gregg Mitchell.
The decade-old email, authored by a retired Trinity vice-president, Steven Brown, proposed changing the guide channel from five inches to four to make the terminal eight pounds lighter and save $2 a unit, without telling the FHWA, as it is required to do: “If [the Texas Transportation Institute] agrees, I’m feeling that we could make the change with no announcement.” TTI, an arm of Texas A & M University, invented the ET-2000 and the ET-Plus, and was responsible for conducting the testing that would be submitted to the federal government in support of its application for approval. TTI agreed to the change without telling the government, and drafted a test report that failed to reference the change to the guide channel and other changes to the original design, first approved in 1999.
Trinity President Gregg Mitchell took the stand and made the company look like incredibly sloppy engineers who deliberately concealed the changes to the government. Mitchell testified that Trinity had no meetings to discuss the dimension changes and performance issues with the ET-Plus. In fact, the company did no evaluations of the product.
A typical exchange between Mitchell and one of Harman’s lawyers, George Carpinello, went like this:
Carpinello: What studies did you consult, sir, or did TTI consult to your knowledge to determine that a change from 5- to 4-inch would improve the alignment of the extruder head, and, therefore, enhance the extrusion — extrusion during a head-on impact?
Mitchell: I’m not aware of any studies.
Carpinello: What field studies were done, sir?
Mitchell: I’m not aware of any field studies.
Carpinello: What computer analysis was done, sir?
Mitchell: I’m not aware of any computer analysis.
Carpinello: Was anyone consulted other than TTI and Trinity?
Mitchelll: Not that I’m aware of.
Carpinello: Did you go to any contractors and ask them, sir, whether they saw anything in the field that indicated that Trinity should change from a 5- to 4-inch to enhance the rail
extrusion during head-on impacts, sir?
Mitchell: I’m not aware of field studies that were done. No.
Carpinello: Did you consult any public officials, any DOT officials, state police, or outside experts to ask if there was a problem with regard to the extrusion during head-on impacts so that we should change it from 5- to 4-inch?
Mitchell: I’m not aware of any.
Click here to read the full trial transcripts.
The plaintiffs’ bar will be feasting on these admissions for some time.
Trinity executives also never re-ran the most critical test used for certification with the FHWA – a head-on collision with a pick-up truck at highway speed. Instead, Trinity ran a test with a small car to see if a different design change – raising the height of the posts to 31-inches would cause a small vehicle to underride the rail. It did not submit to the FHWA videos of tests with the newly designed four-inch end terminal that showed it failing spectacularly, because, the company argued, it was used in a different type of installation. Trinity’s Vice President of International Sales Brian Smith testified that those crash test videos represented a research project that was ultimately not put into production, and never submitted to the FHWA. Also several Trinity executives and TTI engineers testified that the real reason for the change to the channel width was to mitigate a wobble in the guardrail beam inside the guide channel. Neither could produce any evidence that this wobble existed; TTI engineer Roger Bligh testified that the wobble was something he had observed, but had not tested for.
Dean Sicking, a University of Alabama engineering professor who designed the ET-2000, testified that Mitchell threatened to harm him professionally if he testified in the qui tam trial. Sicking said:
[Mitchell] went on to say that we plan to treat all the witnesses for — for Mr. Harman the same way. And — and I looked at him and I was a little surprised by that and then he said, I hate to see that happen to you.
In 2012, Trinity Industries was successful in fending off federal scrutiny of the safety of its ET-Plus guardrail end terminal, after Harman brought his claims to the attention of the FHWA and several state Departments of Transportation. But Trinity’s loss yesterday follows another state giving the ET-Plus the boot. The Virginia DOT has removed the ET-Plus guardrails from the qualified products list and given Trinity until Friday to provide the state agency a laundry list of items:
Meanwhile, Congress may be leaning in for a better look at the Federal Highway Administration’s acceptance of Trinity’s seven-years-too-late admission of changing a critical dimension, and Trinity’s actions in this debacle.