The Hidden Defect in Auto Product Liability Cases: Federal Preemption
Scott B. Cooper
[This article was first published in the August 2004 issue of Advocate, a monthly journal of Consumer Attorneys Associations for Southern California.]
Imagine you are handling an automotive product liability case that you believe is very strong. Your client has been catastrophically injured by a defect in a car that the manufacturer knew about for years before your client's incident. You spend a year or two meticulously investigating the defect and conducting exhaustive discovery. You spend hundreds of thousands of dollars hiring the best experts and preparing the case for trial.
Then, shortly before trial, you receive the defendant manufacturer's motion for summary judgment arguing that your claims are preempted by federal law governing vehicle safety standards. Despite clear evidence of the defect, the manufacturer's knowledge of the defect, and the defect causing your client's injuries, the court grants the motion and dismisses your client's claims in their entirety.
This scenario highlights one of the hidden dangers in auto product liability cases - federal preemption. It is a defense every plaintiff's counsel handling these cases must consider from the outset of each case. This article attempts to frame the issue, describe the current law, and provide some tips on how to avoid preemption in these cases.
A. The Safety Act and Federal Motor Vehicle Safety Standards
In 1966, Congress passed the National Traffic and Motor Vehicle Safety Act of 1966, 15 U.S.C. §§ 1381-1431 (the "Safety Act"), "to reduce traffic accidents and deaths and injuries to persons resulting from traffic accidents." 15 U.S.C. § 1381. To achieve that goal, Congress empowered the federal Department of Transportation to issue minimum safety standards for motor vehicle performance. See 15 U.S.C. §§ 1391(2), 1392(a). The Department, in turn, delegated this duty to the National Highway Transportation Safety Administration ("NHTSA"). See 49 C.F.R. § 501.2. NHTSA fulfilled its responsibility by promulgating the Federal Motor Vehicle Safety Standards ("FMVSS") published at 49 C.F.R. §§ 571.1- .302. The FMVSS are those minimum standards that a vehicle must meet in order to be sold in the United States.
Most of the FMVSS are "performance" standards, which set forth how a vehicle must perform under certain circumstances. The most recognizable example of a performance standard is the crash testing section of FMVSS 208, which specifies the maximum injury criteria levels for crash test dummies in particular types of barrier impacts. The FMVSS also contain "design" standards, which dictate the parameters of how certain components are actually designed or placed in the vehicle. One example of a design standard is FMVSS 210, which dictates certain zones in which seat belt anchors must be installed.
In the auto defect context, defendants will sometimes assert that the plaintiff's defect claim conflicts with a particular FMVSS and is, therefore, preempted by the Safety Act. As discussed below, the key for plaintiffs' counsel is to plead and prove the defects such that they do not "actually conflict" with the FMVSS, as that term has been defined and applied by the courts.
B. Geier v. American Honda
The seminal U.S. Supreme Court case on the preemption of auto defect claims is Geier v. American Honda Motor Company, Inc., 529 U.S. 861, 120 S. Ct. 1913 (2000). Although the Geier Court found that the claim being pursued by the plaintiff was preempted, it is important to understand the rationale of the holding in order to limit the scope of the opinion.
Geier involved a "no airbag" claim. The plaintiff was alleging that her injuries were exacerbated by the fact that her vehicle - a 1987 Honda Accord - lacked a driver's side airbag. Geier, 529 U.S. at 865. Plaintiff asserted that Honda had designed the car negligently and defectively by failing to equip the car with a driver's side airbag. Id.
Honda argued that this no airbag claim was preempted by the Safety Act, and in particular, FMVSS 208. Honda cited to the portion of FMVSS 208 that required car manufacturers to "phase in" passive restraint requirements beginning in model year 1987. According to the Court, there were two important prongs to this phase-in requirement. First, the requirements allowed manufacturers to chose among different passive restraint mechanisms, such as airbags, automatic seatbelts, etc. Id. at 878. Second, NHTSA implemented a gradual phase-in of the passive restraints, requiring them on only 10% of 1987 models and increasing the percentage until it reached 100% for the 1990 model year. Id. at 879.
The Court was also sensitive to some of NHTSA's concerns that led it to create the phase-in scheme as opposed to requiring a specific type of system on all cars. Those concerns included the fact that passive restraints were relatively new to the marketplace, it was not known how the public would react to the various systems, and NHTSA wanted to allow manufacturers to experiment with a variety of systems in order to find the best ones. Id. at 877-79. Honda argued that the plaintiff's no airbag claim conflicted with this passive restraint phase-in scheme and was therefore preempted by FMVSS 208.
2. No express preemption
In its first holding, the Court unanimously found that the Safety Act did not expressly preempt plaintiff's claim. Id. at 868. Honda had argued for express preemption under the Safety Act's preemption provision. 15 U.S.C. § 1392(d). The Court rejected this argument, relying on the Safety Act's "savings clause," which states: "Compliance with any [FMVSS] shall not exempt any person from any liability under common law." 15 U.S.C. § 1397(k); Geier, 529 U.S. at 867-68. Although most lower courts that had considered this question had also rejected express preemption, this was still an important victory for plaintiffs for at least three reasons.
First, some lower courts, including the Ninth Circuit, had adopted express preemption. See Harris v. Ford, 110 F.3d 1410 (9th Cir. 1997). Those cases are no longer good law. Second, this ruling made clear that the vast majority of automotive defect cases are not preempted. As the Court noted, preemption does not apply "where federal law creates only a floor, i.e., a minimum safety standard." Geier, 529 U.S. at 868. The vast majority of the FMVSS do just that - create a minimum standard. Finally, this holding was important because it can be applied to other federal statutes with similar preemption provisions (i.e., the Consumer Product Safety Act and the Federal Boat Safety Act).
3. The Court found implied preemption, but on limited grounds
Despite the clarity of the savings clause, a five-member majority of the Court decided to apply implied preemption principles to the Safety Act and the FMVSS. Id. at 874. The Court held that if a tort claim "actually conflicts" with the FMVSS, then it is preempted. Id. A claim actually conflicts when it "stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress." Id. at 873.
Applying these principles, the Court found that the plaintiff's no airbag claim actually conflicted with FMVSS 208. Id. at 874. Although the result is not what the plaintiffs' bar had hoped for, it is important to look beyond the result to the reasoning behind the Court's decision. Doing so will allow the reader (and other courts) to put the case in its proper context and narrow the application of the ruling to future cases.
In short, the basis on which the Court found preemption was extremely narrow. Specifically, the Court found a conflict with FMVSS 208 based on the detailed NHTSA policy behind the passive restraint phase-in scheme. According to the Court, plaintiff's no airbag claim aimed at the 1987 Accord was the equivalent of requiring all 1987 model year vehicles to be equipped with an airbag. Id. at 881. The Court was concerned that such an "all airbag" rule in 1987 would have "presented an obstacle to the variety and mix of devices that the federal regulation sought." Id. The Court had noted that NHTSA wanted this variety to "help develop data on comparative effectiveness" and to "facilitate the development of alternative, cheaper, and safer passive restraint systems." Id. at 862.
In all preemption cases relying on Geier, the plaintiff needs to focus on this narrow predicate of the Court's ruling. The Court did not find that tort claims are preempted merely because there is a FMVSS covering the component at issue. The Court limited its holding to those cases where the claim would actually conflict with the stated purposes and goals of NHTSA.i
4. The DOT's amicus brief
In order to properly understand limits of the Court's ruling, it is also important to note that the Court relied heavily on the position of the U.S. Government in its amicus brief. See Brief for the United States as Amicus Curiae Supporting Affirmance ("U.S. Brief"), 1999 WL 1045115. The Court found the Government's positions persuasive because, according to the Court, they represent the Department of Transportation's interpretations of its own standards. Geier, 529 U.S. at 883-84. In fact, a comparison of the amicus brief and the opinion shows that the Court's rationale was adopted almost wholesale from the Government's brief.
Like the Court, the Government took a very narrow stance on preemption, and some of the positions in the Government's brief can be used by plaintiffs' counsel to limit the scope of the opinion. For example, the Government stated that automotive design defect cases are not preempted merely because they require more than the minimum federal standard. U.S. Brief, 199 WL 1045115, *21. More importantly, the Government took the position that such claims are not preempted merely because the standard provides multiple options from which a manufacturer can chose in designing its cars. Id. at *21-22. Plaintiffs can use this brief and the Government's official positions in support of their arguments opposing preemption of future claims.
C. California and the Ninth Circuit
Surprisingly, there are currently no published California State or Ninth Circuit cases applying Geier to an automotive defect case. We can, however, look to lower court opinions or courts that have cited to Geier in other contexts to determine where things may be heading.
1. Kent v. DaimlerChrysler and Chamberlain v. Ford
In two recent cases, the Northern District of California has properly applied a narrow reading of Geier in denying motions to dismiss automobile class actions. See Kent v. DaimlerChrysler Corp., 200 F. Supp. 2d 1208, 1210 (N.D. Cal. 2002); Chamberlain v. Ford Motor Company, ___ F. Supp. 2d ___, 2004 WL 615090 (N.D. Cal. March 24, 2004). Kent is a class action alleging that certain model year Jeep Grand Cherokees have a design defect which causes them to self-shift from park to reverse. Kent, 200 F. Supp. at 1210. DaimlerChrysler argued that plaintiffs' claims were preempted by FMVSS 102, which addresses transmission issues.ii
The court, citing to Geier, rejected that argument. It noted the Geier Court's reliance on the history of FMVSS 208 and NHTSA's stated desire to encourage a mix of passive restraint systems. Id. at 1215. By contrast, the court found no such policy rationale in FMVSS 102. Id. at 1216. This case presents a correct narrow reading of Geier that can be used in future preemption cases in California and the Ninth Circuit.
Likewise, in Chamberlain, the court engaged in a proper interpretation of Geier and denied Ford's motion to dismiss a class action complaint. The court found that Geier's preemption holding was based on the history of FMVSS 208 and "the Department of Transportation's carefully considered policy decision to allow gradual introduction of safety devices better to meet safety needs and accommodate manufacturers and the public." Chamberlain, 2004 WL 615090, *10. Like Kent, the court found no such "considered policy choice" at issue in that case. Id.
2. Leipart v. Guardian Industries
Shortly after Geier was decided, the Ninth Circuit applied it in a non-auto context. In Leipart v. Guardian Industries, 234 F.3d 1063 (9th Cir. 2000), the plaintiff alleged he was injured due to defects in a shower door that caused it to break into long, dangerous shards rather than into small, relatively harmless pieces. Leipart, 234 F.3d at 1065-66. The defendant argued such claims were preempted by the federal Consumer Product Safety Act ("CPSA"). Like the auto Safety Act, the CPSA calls for the promulgation of standards similar to the FMVSS, and one of those standards specifically addresses the manner in which shower doors must break if subjected to a certain force. Id. at 1066. The CPSA also contains an express preemption clause and savings clause almost identical to the auto Safety Act. Id. at 1066-67.
Like Geier, the Leipart court first held that the CPSA did not expressly preempt the plaintiff's claims. Id. at 1069. The court then went on to distinguish Geier and hold that the CPSA also did not impliedly preempt the claims. Id. at 1069-70. In doing so, the court cited to the fact that Geier relied upon NHTSA's stated policies behind the phase-in provisions of FMVSS 208. Id. at 1069. The CPSA is different because it merely created a "floor" or minimum standard above which state law could impose further duties. Id. at 1070.
Plaintiffs in automotive defect cases can use this case to show that the Ninth Circuit acknowledges the limited scope of Geier. Specifically, the Ninth Circuit correctly recognizes that the FMVSS do not preempt tort claims that simply hold the manufacturers to standards higher than the bare minimum required by the FMVSS.
D. How to avoid preemption
Faced with this precedent, the question becomes how plaintiffs' counsel in automotive defect cases can avoid preemption. The short answer is through careful pleading and preparation of the claims. As discussed below, from the moment a case first comes in the door, plaintiffs' counsel must be thinking about preemption in order to anticipate the arguments and prepare the case to be "preemption-proof."
1. Remember that FMVSS are just minimum standards
First, depending on the defect alleged, the first argument should always be that there is no preemption because the claim merely seeks to hold the defendant to a higher standard than the FMVSS minimums. See Leipart, 234 F.3d at 1070. Examples of FMVSS that establish minimum performance standards are those dealing with roof crush (FMVSS 216) and seat back strength (FMVSS 207).
Some published cases provide additional examples. In Harris v. Great Dane Trailers, 234 F.3d 398 (8th Cir. 2000), the plaintiff alleged inadequate reflective tape on the back of a truck. FMVSS 108 governs reflective devices on the back of trucks. The court found no preemption because FMVSS 108 only set a minimum standard. Harris, 234 F.3d at 401-02. The court also found that the lack of specific tape configuration requirements did not preempt the claim because it did not constitute a federally granted "option" like the standard at issue in Geier. Rather, it simply "left the industry where it was before - free to make voluntary decisions" about safety devices. Id. at 402-03.
Rogers v. Cosco, Inc., 737 N.E.2d 1158 (Ind. Ct. App. 2000), involved alleged defects in a child booster seat. Although FMVSS 213 includes performance and design requirements for booster seats, the court held there was no implied preemption because the standard merely created a regulatory floor. Rogers, 737 N.E.2d at 1165-66.
2. Allege a specific design defect - do not attack the choice of a system
One very important trap to avoid - particularly when it comes to occupant restraints - is attacking the manufacturer's choice of a certain system. For example, courts have dismissed (on preemption grounds) claims alleging that motorized passive seat belts are defective because they are coupled with a manual lap belt. See, e.g., James v. Mazda Motor Corp., 222 F.3d 1323 (11th Cir. 2000); Hernandez-Gomez v. Volkswagen of America, Inc., 201 Ariz. 141, 32 P.2d 424 (Ariz. Ct. App. 2001).
A plaintiff can try to avoid this problem by alleging a specific design defect instead of attacking the system as a whole. For example, in the passive seat belt cases, there may be legitimate claims based on the geometry of the system (that the belt did not fit the occupant appropriately) or the lack of an effective knee bolster to hold the occupant in place. See, e.g., Carrasquilla v. Mazda Motor Corp., 166 F. Supp. 2d 169, 178-79 (M.D. Pa. 2001). Another example is defective airbags. In its amicus brief in Geier, the Government stated that a claim alleging that an airbag deployed improperly would not be preempted, and even a no airbag claim alleging that the car needed an airbag because of design features particular to that car would not necessarily be preempted. See U.S. Brief, 1999 WL 1045115, *26, n.23. The Geier Court itself said that its opinion did not address the latter claim. Geier, 529 U.S. at 885-86.
This strategy requires more creativity in pleading and proving up the case, and it usually entails more intensive expert work. The plaintiff's attorney needs to recognize these issues at the outset of the case to avoid pleading the case into preemption.
3. Argue that options do not equal preemption
If the facts of the case compel you to attack the type of system in a vehicle, argue that the mere existence of options in the FMVSS does not mean that a claim based on the choice of one of those options is preempted. The Government took this position in its amicus brief, when it stated that even though FMVSS 125 gave manufacturers multiple options for the design of reflective devices on stopped vehicles, NHTSA did not determine that the availability of these options was necessary to promote safety. U.S. Brief, 1999 WL 1045115, *21-22. In other words, the plaintiff's counsel in such a case needs to go back to the basis of Geier and argue that the "options" at issue in that case were part of a unique phase-in scheme that sought a mix of systems. Absent such a specific regulatory history promoting the mix of options, preemption should not apply.
Making this argument will be an uphill battle in light of some poorly-reasoned cases decided since Geier. In Hurley v. Motorcoach Industries, Inc., 222 F.3d 377 (7th Cir. 2000), the plaintiff alleged that a bus was defective because the driver's seat was equipped with a lap belt only. Hurley, 222 F.3d at 378. At the time, FMVSS 208 allowed a lap-belt-only system as an option on busses, but it had no phase-in requirement like the provision at issue in Geier. Nevertheless, the Seventh Circuit held that "a state lawsuit that forecloses an option left open by FMVSS 208 is in fact preempted." Id. at 382.
The plaintiff in Griffith v. General Motors Corp., 303 F.3d 1276 (11th Cir. 2002), alleged a pick-up truck was defective because it included a lap-belt-only system in the front center seating position as opposed to a lap/shoulder belt combination. The court held this claim was preempted simply because such a configuration was allowed as an option by FMVSS 208. Griffith, 303 F.3d at 1282.
Although these cases engage in an incorrect, overly broad reading of Geier, they are published opinions that will need to be addressed. When faced with these cases, you can argue that these courts have misconstrued Geier and use the Government's arguments in its Geier amicus brief as ammunition. You must also thoroughly research the regulatory history of the standard at issue to establish that NHTSA did not consider the availability of options necessary to promote safety.
4. Seek a NHTSA opinion that your claim does not conflict with the FMVSS
Another more unconventional tactic is to see if you can get an opinion from NHTSA that your claim does not conflict with the FMVSS. You can try to seek this sort of opinion from the agency itself, which would most likely come from the Office of the Chief Counsel. Given the Geier Court's reliance on the agency's interpretation of its own standards, this sort of evidence could be very helpful.
It is not easy to get such an opinion. It helps if you can find someone who has contacts with the agency, like a the head of a consumer group or other safety advocate. These opinions are rarely given, and they are usually reserved for the appellate level. If you cannot obtain an official agency opinion, another option is to retain an ex-NHTSA official (preferably from the counsel's office) as an expert to provide an opinion based on a comparison of your claims with his or her knowledge of NHTSA's regulations and the policies behind those regulations.
5. Allege a failure to warn claim
Finally, if you think a design defect claim will be preempted, always consider pleading a failure to warn claim, but be careful not to tie that warning claim to the design defect claim. The basic argument goes something like this: plaintiff is not alleging that the design is defective, but rather that the vehicle might be hazardous when used in a certain way, and occupants need to be warned of that hazard. A simple example is a lawnmower. Although the basic lawnmower design is not necessarily defective, it is hazardous, and the lack of a proper warning regarding the hazards may create an action absent any design defect.
In the automotive context, the plaintiff could argue that he or she is not alleging that a particular design is defective (which might foreclose an option allowed by the FMVSS). Rather, the plaintiff is alleging that the particular design simply presents hazards about which the manufacturer should adequately warn. This argument could be particularly effective in California, where the courts have recognized that a reasonably designed product may still be "defective" if it lacked proper warnings regarding particular hazards. See, e.g., Gonzalez v. Carmenita Ford Truck Sales, Inc., 192 Cal. App. 3d 1143, 1150-51, 238 Cal. Rptr. 18 (1987) ("the warning requirement is not limited to unreasonably or unavoidably dangerous products"); see also Canifax v. Hercules Powder Co., 237 Cal. App. 2d 44, 53, 46 Cal. Rptr. 552 (1965).
This argument has thus far not been adopted in a published opinion, although some courts have accepted the argument in unpublished decisions. A few published opinions have held these failure to warn claims preempted along with the design defect claims. See, e.g., James v. Mazda Motor Corp., 222 F.3d 1323 (11th Cir. 2000). Each of these cases, however, found that the warnings claim was dependent on, or "tied to," the design defect claim. Id. at 1325; see also Carrasquilla, 166 F. Supp. 2d at 179-80. Plaintiffs need to distinguish these cases by arguing that their warnings claims do not depend on a finding that the product is defective.
In any automotive design defect case, the plaintiff's counsel needs to consider preemption from the moment the case comes in the door. You should closely examine Geier and all post-Geier decisions, along with the regulatory history of any applicable FMVSS, and think of any manner in which the defense could argue that your client's allegations conflict with the FMVSS. You then need to plead and prove-up your case to avoid these pitfalls, which may require retaining experts early to shape the case properly. If done right, you should be able to avoid preemption in most of these cases.
iThe most recent case on preemption from the Supreme Court is Sprietsma v. Mercury Marine, 537 U.S. 51, 123 S. Ct. 518 (2002). That case involved the Federal Boat Safety Act of 1971, which has similar preemption and savings clauses as the auto Safety Act at issue in Geier. Id. at 55-59. The Court in Sprietsma unanimously rejected both express and implied preemption, and in doing so, reaffirmed the limited basis on which Geier found preemption - the policies behind the FMVSS 208 "phase-in" requirements. Id. at 65-66, 67-68.
ii DaimlerChrysler also argued that the injunctive relief sought by the plaintiffs (requiring the manufacturer to repair the defect) would interfere with NHTSA's authority to conduct safety-related recalls under the Safety Act. Kent, 200 F. Supp. at 1212. That is an issue beyond the scope of this article and will therefore not be discussed in detail. For a discussion of the court's rejection of this argument, see the Kent opinion at pages 1217 to 1218.