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Press Release |
Contact: |
Press Release Contact:
Tuesday, September 19,
2000
Elisa Odabashian or Harry Snyder
(415) 431-6747
Consumers
Union West Coast Regional Office
Company Executives May
Have Violated California's Corporate Criminal Liability Act if They
Failed to Notify State Officials Once They Learned About Tire
Defects
SAN FRANCISCO - Consumers Union, the non-profit
publisher of Consumer Reports, called on California Attorney
General Bill Lockyer today to investigate whether executives of
Bridgestone/Firestone and Ford violated a California law by failing
to alert state officials about dangerous tire defects in a timely
manner. Under California's Corporate Criminal Liability Act, managers
of businesses, including officers and executives, can face criminal
prosecution for concealing dangers in products or workplace settings
that could put consumers or workers at risk of death or injury if
they fail to notify state officials within fifteen days of learning
of the defects.
"This case once again reminds us of the need
for greater accountability when corporations knowingly sell
dangerous, defective products to consumers," said Harry Snyder,
Senior Advocate for Consumers Union's West Coast Regional Office. "If
company officials at Bridgestone/Firestone or Ford knew of the
serious concealed dangers in these tires and failed to properly
notify California officials about them, then they should face
criminal prosecution."
On August 9, Bridgestone/Firestone announced
the recall of its P235/75R15 Firestone ATX, ATX II, and Wilderness AT
tires. The tires have been recalled because of tread separations that
have been blamed for dozens of fatal crashes. Officials at both
companies have maintained that they were not aware of the scope of
the tire defects until shortly before they announced the recall.
However, evidence is mounting that officials at Bridgestone/Firestone
and Ford may have been aware of these dangerous defects long before
the tire recall was announced.
For example, news accounts have indicated that
Congressional investigators have internal documents obtained from
Firestone detailing the company's damage and injury claims showing a
high incidence of tire failure as early as 1997. Similarly,
congressional investigators reportedly believe that Ford may have
ignored trends in its own warranty data, which showed that the
company had received claims for hundreds of defective tires between
1991 and 2000.
Furthermore, Ford's 1999 recalls of Firestone
tires sold on Ford Explorers in 16 countries abroad were not reported
to the National Highway Traffic Safety Administration, even though
they were similar to tires sold on Explorers in the United States.
While companies are not legally required under federal law to notify
NHTSA regarding recalls in foreign countries, the companies may have
been required to report this information to California state
officials under the Corporate Criminal Liability Act. Since 1992,
there have been as many as 50 to 100 lawsuits related to the
Firestone tires subject to the current recall. Many of these lawsuits
were settled with secrecy orders in place, with the effect that
critical safety information may have been kept from the public.
Consumers Union was instrumental in creating
the California Corporate Criminal Liability statute, which was signed
into law by then-Governor George Deukmejian in 1990. California is
the only state with a law that requires individuals within
corporations to report known, hidden dangers in the products or
workplaces under their management. Under the statute, failure to
notify the California Division of Occupational Safety and Health
Agency in the Department of Industrial Relations (Cal-OSHA) could be
a felony.
The Firestone tire recall has prompted calls by
lawmakers in Congress for a federal statute that would subject
corporations and their executives to criminal prosecution if they
failed to notify regulators of known product dangers. On September 7,
Senator Arlen Specter (R-PA) introduced a bill that would impose
federal criminal penalties on the employees of any corporation who
knowingly and recklessly introduce a defective product into
interstate commerce.
"Lawmakers in Washington are seeking to enact
the very criminal liability that California has had on the books for
nearly a decade," said Elisa Odabashian, Senior Program Manager at
Consumers Union's West Coast Regional Office. "If the Attorney
General determines that the California Corporate Criminal Liability
Act has been violated in this case, we urge him to bring criminal
charges against the responsible parties at these companies. Corporate
executives need to know that they may face jail time and financial
penalties for failing to notify California officials about dangerous
product defects."
A copy of Consumers Union's letter
to Attorney General Bill Lockyer urging him to investigate possible
violations of the Corporate Criminal Liability Act by
Bridgestone/Firestone and Ford is available online at
www.consumersunion.org
or by calling 415-431-6747.
Consumers Union, publisher of Consumer Reports, is an independent, nonprofit testing and information organization, serving only the consumer. We are a comprehensive source of unbiased advice about products and services, personal finance, health, nutrition, and other consumer concerns. Since 1936, our mission has been to test products, inform the public, and protect the consumers.
