Legislation Proposed in Response to Flood of Car Defect Cover-ups

By Paul da Costa on December 08, 2014

We have previously blogged about the many car defect scandals that have arisen this year, even after automakers knew of the product defects for years. G.M.’s defective ignition switch was the one of the first problems to be kept from regulators. Then, Takata, a Japanese airbag producer, hid the defect in its airbags from regulators for years. Only recently have these defects come to public light and Congress has finally been able to take action.

Congress, however, is doing more than just looking into the problems surrounding these two defects. The New York Times has reported that Senator Richard Blumenthal (D-CT) has proposed three bills that would prevent product defects from being hidden by automakers in the future. The first of the three bills, the Sunshine in Litigation Act, would prevent product liability settlements from being kept secret. In G.M.’s case, for example, the automaker made settlements with those injured by the defects that required the injured person to keep quiet about the settlement. This would also prevent judges from sealing court records in product liability cases.

The second proposed bill is the Automaker Accountability Act. Currently, civil penalties for safety violations have a maximum of $35 million. This bill would allow regulators to impose penalties based on “severity of the offense,” instead of the maximum mandated by the statute.

The last piece of proposed legislation is the Hide No Harm Act. This bill would impose criminal penalties, including fines and prison time, if a business or corporate officer failed to notify regulators of a product defect. There is currently no obligation on the part of businesses to disclose potential defects.

Although many major corporations may oppose these proposed bills, the safety of consumers may be of utmost importance to legislators following the outbreak of product defect scandals this year. If you or a loved one has been injured by a product defect, whether it be in an automobile or otherwise, you may have a personal injury claim. The experienced attorneys at Snyder & Sarno, LLC can help obtain just compensation for your injuries. Call us today at (973) 274-5200.