In 2000, Congress passed the TREAD Act (Transportation Recall Enhancement, Accountability and Documentation Act), an auto safety law requiring automakers to inform regulators about any product safety defects within five days or face stiff civil penalties. Product liability experts at Berkowitz and Hanna LLC also point out that the Act makes it a crime to intentionally mislead the NHTSA (National Highway Traffic Safety Administration) about defects that lead to serious auto accidents. This relates directly to a recent fine of $70M that auto giant Honda Motor Company has been slapped with, for underreporting.
On the tail of investigations into the global problem of defective airbags, a spotlight has been cast on all automakers and their diligence in reporting warranty claims and deaths and/or injuries linked to product defects. NHTSA’s review of Honda uncovered an 11-year span of underreporting, which Honda referred to as “inadvertent data entry or computer programming errors.” The NHTSA issued Honda with two separate $35M fines, each the maximum allowed under U.S. law.
The first addresses the automaker’s failure to report 1,729 deaths and injury claims from 2003 to 2014 and the second fine “covers lapses on completely reporting warranty claims and repairs offered under ‘customer satisfaction campaigns.'” In addition, Honda has been ordered to revise its regulatory compliance practices, improve personnel training and complete two outside audits on its data reporting.
In October 2014, The Center for Auto Safety, a research group that has been tracking auto recalls and defects since 1970, asked transportation regulators to refer Honda to the Justice Department for criminal investigation. Having litigated many wrongful death and personal injury cases involving auto defects, Berkowitz and Hanna LLC understands that sometimes criminal charges are often the next step—not only in seeking justice for the injured parties, but also to send out a clear message to manufacturers that failure to address safety defects in products will have serious consequences.
Note: Berkowitz and Hanna LLC did not represent any of the parties in this case.
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