[Congressional Record (Bound Edition), Volume 146 (2000), Part 12]
[Senate]
[Pages 17376-17377]
[From the U.S. Government Publishing Office, www.gpo.gov]



                      FIRESTONE-FORD INVESTIGATION

  Mr. SPECTER. Mr. President, I have sought recognition to deal with 
very serious problems disclosed in hearings yesterday in the 
Transportation Appropriations Subcommittee. The hearing involved 88 
deaths that have resulted from Firestone tires shredding, and a great 
many Ford vehicles--mostly Ford Explorers--rolling over and resulting 
in those 88 deaths.
  The hearing yesterday produced substantial evidence that ranking 
officials at Firestone and Ford knew about this problem, but subjected 
the owners of Ford Explorer vehicles riding on Firestone tires to the 
risk of death, which did eventuate for 88 people, and to very serious 
bodily injury formany more. These risks were foisted upon the American 
traveling public at a time when both Ford and Firestone knew what the 
problems were, at a time when, in October of 1998, customers in 
Venezuela had found the problem, and Ford and Firestone were alerted to 
it, with officials in Venezuela now talking about criminal 
prosecutions. In August of 1999, the Saudis had their tires replaced, 
so the people in Saudi Arabia were being protected while U.S. consumers 
were not being protected.
  An internal Ford memorandum on March 12, 1999, considered whether 
Governmental officials in the United States ought to be notified, and a 
decision was made not to notify Federal officials. The matter then came 
into sharp focus in late July of this year, with the Ford executive 
witness testifying that Ford did not know about the problem in its full 
import until July 27 when Firestone turned over the information to 
Federal authorities. There was a representation by the Ford witness--
which candidly strains credulity--and Firestone made representations 
that they did not find out about this problem until they had conducted 
some extraordinary tests--tests which obviously should have been 
conducted at a much earlier stage.
  Yesterday, I questioned the Ford and Firestone officials on their 
willingness to turn over all of the records to the Transportation 
Appropriations Subcommittee, and they said they would; although, as I 
had said at the time, I thought there ought to be a subpoena issued 
which made it an obligation. Failure to perform would subject anybody 
who did not comply with the subpoena to charges of obstruction of 
justice. When cases of this sort have arisen in the past, there is a 
tremendous amount of experience that there is reluctance on the part of 
companies to turn over their documents, and they are found only after 
the most detailed and excruciating discovery in litigation. So this is 
a matter where the documents will be the best evidence as to who knew 
what, when that was known, and what action, if any, was taken.
  The tragedy with the Firestone tires and the Ford Explorer rollovers 
is a matter that is going to have to be determined after very 
substantial investigation. The witnesses who testified yesterday were 
Joan Claybrook, President of the Public Citizen Organization, and R. 
David Pittle, Senior Vice President and Technical Director, Consumers 
Union. Both of them felt that criminal prosecutions were appropriate, 
perhaps rising to the level of second degree murder because of a 
willful disregard or reckless disregard of the safety of others, 
resulting in death, which is the legal equivalent of malice and which 
is the basis for a charge as serious as murder in the second degree.
  Whether that is applicable to Firestone and Ford remains to be seen. 
However, we find a situation where the laws of the United States are 
inadequate to deal with this kind of situation. There is no legislation 
on the books which establishes a prosecution in these terms.
  Back in 1966, the House of Representatives considered similar 
legislation. I have considered it for some time and have deferred 
introducing such legislation because it seemed to me that perhaps it 
was just a little harsh. But with the experience of Ford and Firestone, 
I do think it is appropriate for the Congress of the United States to 
consider such legislation.
  That is why today I am introducing a bill which would establish 
criminal sanctions for any person who, in gross deviation from a 
reasonable standard of care, introduces into interstate commerce a 
product known by that person to be defective which causes the death or 
serious bodily injury of any individual, calling for penalties up to 15 
years where the requisite malice is shown resulting in death, and up to 
5 years where the requisite malice is shown for serious bodily injury.
  This is a matter I have studied in considerable detail over many 
years, having represented defendants in personal injury cases--some 
plaintiffs in personal injury cases--but, more specifically, as 
district attorney of Philadelphia seeing the impact and the effect of 
criminal prosecutions and seeing to it that people pay attention.
  When there are similar monetary awards, it costs the company and it

[[Page 17377]]

costs the shareholders, but it doesn't do anything to the individuals 
who make these decisions. Before an individual could be held 
responsible under my proposed legislation, there would have to be a 
showing that the person knew there was a defect and that defect 
subjected a person to death or serious bodily injury.
  That kind of knowledge and putting the instrumentality into commerce 
does constitute gross disregard for the safety or the life of another, 
which is the equivalent of malice and justifies this kind of a 
prosecution.
  As I noted, this is a subject I have studied for some time. Although 
the Firestone-Ford issue came up only yesterday, the studies I have 
undertaken have shown me the desirability of this kind of legislation.
  Last year, in Anderson v. General Motors Company, 1999 WL 1466627, a 
Los Angeles Superior Court jury ordered General Motors to pay a record 
$4.8 billion in punitive damages when six people were trapped and 
burned when their Chevrolet Malibu exploded after its fuel tank was 
ruptured in a rear-end crash. General Motors had made a calculation 
that it would cost in damages $2.40 per automobile if they left the 
defect in existence, but to correct and redesign the fuel system to 
reduce the fire cost would have been $8.59 a car. So that cost analysis 
did constitute actual malice.
  That kind of an analysis was very similar to the punitive damages 
which were awarded in the famous case involving the Ford Pinto, which 
goes back to a 1981 decision in Grimshaw v. Ford Motor Company, 119 
Cal. App. 3d 757, where an analysis was made that it would cost some 
$49.5 million to pay damages resulting from deaths and injuries 
contrasted with $137 million to pay for correcting the automobile.
  In this particular case, the punitive damage award was $125 million, 
but it was subsequently reduced to $3.5 million, which frequently 
happens in punitive damage awards.
  In a similar case, Ginny V. White and Jimmy D. White v. Ford Motor 
Company, CV-N-95-279-DWH (PHA), a 3-year-old child was crushed to death 
under the rear dual wheels of a Ford truck after it rolled suddenly 
down a grade. Here, Ford had known of the defect and knew how to 
correct it easily but did not do so. Punitive damages in that case were 
awarded at $150 million but have since been reduced to $69 million.
  These cases are illustrative of the kind of headlines punitive damage 
awards make in the newspapers but how they are very frequently reduced. 
But again, the punitive damages do not really deal with the executives 
who make these decisions.
  In the case of Fair v. Ford Motor Company, Civil Action 88-CI-101, 27 
people were killed when a school bus in which they were riding burned 
after being struck by another vehicle. Punitive damages were upheld in 
this case where the facts showed that the fuel tank failure was 
preventable and that Ford had the capacity and the opportunity to 
prevent it and failed to do so.
  In another similar case, Toyota Motor Company v. Moll, 438 So. 2d 192 
(Fla. App. 1983), a Toyota Corona was struck in the rear, causing its 
fuel system to rupture and three women were burned to death. The court 
found malice on the part of Toyota because Toyota knew of the defective 
design of the fuel system and, in wanton disregard of the safety of the 
purchasing public, continued to market their 1973 Toyota Corona.
  In Ford Motor Company v. Ammerman, 705 N.E. 2d 539 (Ind. App. 1999), 
the Court of Appeals for the Fifth Circuit of Indiana imposed punitive 
damages, finding malice on the part of Ford, when a Bronco slid 
sideways and rolled over causing very serious injuries, with the court 
saying:
  ``It is apparent to this court that Ford was motivated by profits 
rather than safety when it put into the stream of commerce a vehicle 
which it knew was dangerous and defective. Ignoring its own data and 
advice of its engineers, Ford manufactured a vehicle prone to roll-over 
accidents in spite of being aware that such accidents result in more 
serious injuries than any other.'' 705 N.E. 2d at 562.
  There are similar findings in the famous breast implant case, Hopkins 
v. Dow Corning, 33 F.3d 1116 (9th Cir. 1994), where they knew that long 
studies of implants were needed before the product could be marketed 
but concealed the information.
  Similarly, in the Dalkon Shield case, Tetuan v. A.H. Robins Co., 738 
P.2d 1210 (Kan. 1987), thousands of women were presented with life-
threatening and even fatal illnesses with the Kansas Supreme Court 
noting that the company deliberately and actively concealed the 
potential dangers of the product, thereby violating their duty to the 
public.
  In the interest of time, I will summarize very briefly Batteast v. 
Wyeth Laboratories, Inc., 526 N.E. 2d 428 (Ill. App. 1 Dist. 1988), 
where punitive damages were awarded where drugs were given to 
individuals knowing of their dangerous propensity.
  Similarly, in the case of Proctor v. Davis, 682 N.E. 2d 1203 (Ill. 
App. 1997), a patient had a retina detachment and blindness following 
the adverse effects of a drug which were known to the manufacturer but 
not disclosed.
  In the brief time available this afternoon, I have summarized a 
series of cases which are only representative--where products have been 
put in interstate commerce, where there was knowledge on the part of 
individuals who put those products on the market that they would 
subject the individuals to risk of serious bodily injury or death, and, 
when death resulted, they were held liable, with the courts concluding 
that malice was established by the reckless disregard of the life of 
another.
  When we have such a long sequence of cases, when we have the 
occasional imposition of punitive damages which are characteristically 
reduced and not really determinative or therapeutic anyway because it 
goes only after the shareholders as opposed to the individuals who have 
the ability to eliminate the problem, it is time there was adequate 
legislation on the Federal books to deal with this sort of problem.
  I repeat, the culpability of Firestone or Ford has not yet been 
established, but it strains credulity that the key officials, based on 
what we heard yesterday in the hearing, did not know of these defects, 
and with the documents already at hand failed to take action to correct 
them. That is a matter to be determined.
  But this legislation, if enacted, will certainly put the officials on 
notice that they cannot recklessly disregard human life for profits.
  I yield the floor.

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