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Today, it was reported on that Honda is issuing a recall on 440,000 vehicles. According to the article, there is a potential defect in driver-side airbags in 2001-02 Honda Accords, 2001 Civics and 2002-03 Acura TLs. Already, six injuries and one death have been reported.

So, what does this recall have to do with Chrysler?

Well, this article points out the flaw in the bankruptcy court’s decision to absolve Fiat and Chrysler of any liability for injuries or deaths resulting from defective Chryslers which were bought before the bankruptcy. This would have been the case in all 440,000 Hondas which have been recalled.

Couldn’t the bankruptcy court have been more thoughtful about the decision? Most times, bankruptcy courts require the debtor to purchase insurance in order to cover such liabilities. Why didn’t Fiat or Chrysler purchase insurance so that the consumer doesn’t suffer? Families who purchased Chryslers before the bankruptcy will suffer an undue hardship if a loved one is seriously injured or killed as a result of a defect in the car, truck or SUV. Shouldn’t that cost be shifted to the new entity through insurance?

If you want more information regarding defective products, please contact our office, and we will send you a report on legal issues in Alabama regarding defective products: Recognizing and Preserving Evidence in Automotive Product Liability Cases.


  1. Gravatar for Facebook User

    Well here’s a question Jon: Does the bankruptcy court’s absolution of Chrysler and Fiat not just take the victim’s hands out of the deepest pockets? Take you Honda example. The car you buy is a Honda, but the airbag is assembled and supplied by a supplier. That supplier produced the airbag from parts from a handful of their suppliers. Thought the auto manufacturer might be immune, that is not to say that liability won’t attach to someone further down the supply chain.

    From my years working as a quality supervisor with an MBUSA supplier, I would have to say that about the only thing most auto manufacturers actually build is the uni-body/chasis and most of the driveline components. Common practice in the auto industry is to have all of your “tier 1” suppliers within a 200 mile radius of the manufacturing facility. This mitigates the possibility of a line shutdown due to shipping complications. So, there is at least a fair chance that the next defendant down that line will be in the same region and it is near certain that they will at least be stateside.

    Of course this is not to say that the consumer is not taking a hit. I am sure that a great deal of products liability cases involving cars deals with the crash worthiness of the body. However, this is certainly not always the case. It seems like the bankruptcy court has put the burden on the suppliers that was once on the manufacturer. This will increase the suppliers overhead, passing the cost on to the car makers, and of course resulting in a higher price for the end user.

    Do you feel this is the case, or am I missing something? It just seems like if the bankruptcy court is able to deprive potential victims of a cause of action for product liability, they would also be absolving the manufacturers and suppliers of their primary motive for producing safe and reliable products.

  2. Gravatar for Jon Lewis

    Well Davy, I don't disagree; however, it is much more difficult to simply bring and prove a claim against the suppliers. Jurors identify with the manufacturer because that is the name on the vehicle. Plus, the defense attorneys will argue the "empty chair", i.e.: Chrysler was really at fault, and they aren't here. It is much better to have all potential defendants in the case so they can argue with each other and so jurors can assign blame accordingly.

    This could have easily been solved with insurance and re-insurance. They could have had an assigned risk pool like they do for hurricane insurance in Florida or with some workers compensation insurance in Alabama. But, that would have been too easy.

  3. Gravatar for Mike Bryant

    The bankruptcy closed the pocket and let them run away without liability for the many things they caused. It is important that this issue continue to be in the forefront of all discussions.

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