WASHINGTON (Legal Newsline) - The nation's trial lawyers are supporting new motor vehicle legislation, while one commentator says they are doing so because it will result in more litigation.
Wednesday, the Senate Commerce Committee discussed the Motor Vehicle Safety Act of 2010, legislation that would raise civil penalties for automakers, force them to provide more safety information to consumers and add new safety equipment.
Carter Wood, of the National Association of Manufacturers, wrote a piece where he questioned the motivation behind the bill.
"In the interest of safety, the proponents run the risk of enacting legislation that will add so many new costs to the vehicles that fewer people will be able to afford to own cars," he wrote.
"There's all the new, expensive equipment that could be mandated, the vast array of additional regulations with their associated costs, and new opportunities for trial lawyers to sue for multi-billion-dollar damages."
The legislation comes after alleged safety problems in Toyota vehicles have been publicized. Lawyers had filed 299 federal cases and 99 state court cases as of May 12, according to a Toyota lawyer seeking consolidation of 15 state court suits in Texas.
The American Association for Justice, the national trial lawyer group, says the legislation will ensure automakers are held accountable for their mistakes.
"Time and again, we have seen auto manufacturers know of safety defects, yet delay or deny problems," AAJ President Anthony Tarricone said.
"While the government must do its part to provide strong standards and oversight, it is the manufacturer that must ultimately be held accountable when human lives are at risk."
According to a summary released by Sen. Jay Rockefeller, D-W.Va., the legislation will:
-Raise civil penalties for automakers that violate vehicle safety standards or withhold critical safety information from the National Highway Traffic Safety Administration;
-Require disclosure of more safety information to consumers, and mandate that NHTSA make its vehicle safety databases more accessible; and
-Give auto industry employees the same whistleblower protections as airline employees.
Rockefeller called the $16 million cap on civil penalties "the equivalent of a parking ticket."
Dave McCurdy, president and CEO of the Alliance for Automobile Manufacturers, testified earlier this month at a House hearing that the Alliance is not against the cap being raised. However, the cap must remain a reasonable amount.
"Congress will need to avoid the possibility of creating a system of 'regulation by litigation," he added.
"Congress should not enact measures that will have the unintended effect of slowing, not accelerating, action on safety matters. If every petition denial is subject to judicial review, NHTSA will be forced to spend substantial resources and time responding to every petition, regardless of its merit, in anticipation of judicial review.
"This will not serve the agency, the industry or the public well."
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