Posted by : attorney stevelee

DOT Slams Takata With Highest Civil Penalty in History for Dangerous Airbags

The Takata Corporation has become infamous over the past year as a result of a faulty airbag recall and class action lawsuit filed against it. Takata Corporation is an automotive parts company based in Japan that produces products such as seat belts, steering wheel systems, child restraints, and of course airbags. However, the quality of their products have come into question as over 19 million cars have been recalled due to airbag safety over the past year.

Years of Inaction and Cover-Ups

The recall was demanded by the National Highway Traffic Safety Administration (NHTSA) and the U.S. Congress in response to the death of seven people and countless injuries that resulted from dangerously explosive charges within the Takata bags. Investigations into the airbags have found that defects within the airbag’s inflater can create such a high force inflation that the inflaters rupture and actually explode on impact, causing such critical injuries as:

  • Third degree burns
  • Impalement by flying debris
  • Severe neck and spinal trauma
  • Traumatic brain damage

…and countless other life-altering conditions.

There are accusations that the Takata Corporation knew about these defects since 2001 but ignored the need for a recall. This blatant disregard for consumer safety is a direct violation of the Motor Vehicle Safety Act. NHTSA also issued findings that Takata repeatedly provided customers as well as the NHTSA itself with incomplete and inaccurate data dating back at least to 2009 to prevent investigations.

“For years, Takata has built and sold defective products, refused to acknowledge the defect, and failed to provide full information to [the] NHTSA. The result of that delay and denial has harmed scores of consumers and caused the largest, most complex safety recall in history.” —Transportation Secretary Anthony Foxx

However, 14 month after the beginning of the recall, and six months after the filing of the class action suit, the NHTSA has ensured that Takata’s past caught up with it.

A Blow to the Face: Takata Is Fined Largest Civil Penalty in DOT History

On November 3, 2015, the Department of Transportation (DOT) and the NHTSA showed aggressive force against the callous Takata Corporation by issuing two historical orders—Consent Order and the Coordinated Remedy Order.

Consent Order Requirements

  • Fine. The imposed consent order requires Takata to pay a record-breaking $200 million fine for violating the Motor Vehicle Safety Act. This fine will begin with a $70 million cash payment and an additional $130 million will be due if Takata fails to meet the rest of the orders’ commitments or if additional violations are discovered.
  • Manufacturing restrictions. In addition to the fine, the company is also ordered to phase out the manufacturing and selling of phase-stabilized ammonium nitrate propellant—which is one of the key components of their airbag inflators—and create a plan to get all affected inflators off of the road until they can determine the exact cause of the ruptures.
  • Unprecedented oversight restrictions. In order to ensure fulfillment of the consent order, a NHTSA representative will be selected to closely monitor Takata’s phase-out progress and compliance for the next five years.

Coordinated Remedy Order

  • Safety recall acceleration. The coordinated remedy order directs Takata to prioritize its remedy programs based on risk factors. A schedule must be established to focus on acquiring sufficient replacement parts to remedy the defects for all affected vehicles within an orderly timeframe.
  • Replacement part requirements. Vehicle manufacturers affected by the Takata airbag recalls are required to have sufficient replacements on hand to meet consumer demand by March 2016 (for the highest-risk inflators), and be ready to provide final remedies for all defective vehicles by the end of 2019.
  • Precedent for future recalls. The order also establishes grounds and precedent for a Coordinated Remedy Program, whereupon the agency will oversee future recalls and the supply of recall replacement parts with the assistance of an independent third-party monitor.
  • Oversight restrictions. The same NHTSA selected monitor will be used to oversee compliance of all facets of the coordinated remedy order in addition to the consent order.

The NHTSA hopes that its show of force and aggressive use of authority will not only clean up these current safety issues, but also secure future public safety.

The Right Way Forward for You

Have you or a loved one been injured as a result of a defective airbag? Call us today for a free consultation and review of your case. You could be entitled to join ongoing lawsuits, or begin a new one for damage, treatment, and emotional compensation. Contact our Houston office today to see how we can help you and your family get the justice you deserve.

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