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The Ford Pinto fuel system controversy is a period related to safety issues of the Ford Pinto, an American-market subcompact automobile. During its


Fuel system fires, recalls, and litigation

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The safety of the design of the Pinto's fuel system led to critical incidents and subsequently resulted in a recall, lawsuits, a criminal prosecution, and public controversy. The events surrounding the controversy have been described as a "landmark narrative".[1] The Ford Pinto has been cited and debated in numerous business ethics[2][3] as well as tort reform[4][5] case studies.

The placement of the car's fuel tank was the result of both conservative industry practice of the time as well the uncertain regulatory environment during the development and early sales periods of the car. Ford was accused of knowing the car had an unsafe tank placement then forgoing design changes based on an internal cost-benefit analysis. Two landmark legal cases, Grimshaw v. Ford Motor Co. and Indiana v. Ford Motor Co., resulted from fatal accidents involving Pintos.[6]

Scholarly work published in the decades after the Pinto's release has examined the cases and offered summations of the general understanding of the Pinto and the controversy regarding the car's safety performance and risk of fire. These works reviewed misunderstandings related to the actual number of fire-related deaths related to the fuel system design, "wild and unsupported claims asserted in Pinto Madness and elsewhere",[7] the facts of the related legal cases, Grimshaw vs Ford Motor Company and State of Indiana vs Ford Motor Company, the applicable safety standards at the time of design, and the nature of the NHTSA investigations and subsequent vehicle recalls.[8] One described the Grimshaw case as "mythical" due to several significant factual misconceptions and their effect on the public's understanding.[9]

Fuel system design

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The design of the Pinto fuel system was complicated by the uncertain regulatory environment during the development period. The first federal standard for automotive fuel system safety, passed in 1967, known as Section 301 in the Federal Motor Vehicle Safety Standards, initially only considered front impacts. In January 1969, 18 months into the Pinto's development cycle, the NHTSA proposed expanding the standard to cover rear-end collisions. The proposed standard was based on a 20 mph moving-barrier rear impact test. Ford publicly announced it supported the standard. In August 1970, the month the Pinto went into production, the NHTSA changed the proposal to a more stringent 20 mph fixed-barrier standard which car companies were to meet in 18 months. The fixed-barrier standard was seen by the auto industry as a significant increase in test severity. At the same time, the NHTSA announced a long-term goal of setting a 30-mph fixed-barrier standard.[10][11] Due to the confusion related to the various proposed standards and an expectation that the NHTSA would not select the more stringent 30 mph fixed-barrier standard, Ford elected to voluntarily meet the 20 mph moving-barrier standard for all cars by 1973.[12][13] Ford and other automobile manufacturers objected to the more stringent fuel system safety standard and filed objections during the required comment periods of the proposed regulations.[14]

The Pinto's design positioned its fuel tank between the solid live rear axle and the rear bumper, a standard practice in US subcompact cars at the time.[15] The Pinto's vulnerability to fuel leakage and fire in a rear-end collision was exacerbated by reduced rear "crush space", a lack of structural reinforcement in the rear, and an "essentially ornamental" rear bumper (though similar to other manufacturers).[16]

As part of a response to the NHTSA's proposed regulations, crash testing conducted In 1970 with modified Ford Mavericks demonstrated vulnerability at fairly low crash speeds. Design changes were made, but post-launch tests showed similar results.[17] These tests were conducted to develop crash testing standards rather than specifically investigating fuel system integrity. Though Ford engineers were not pleased with the car's performance, no reports of the time indicate particular concern.[18] The Pinto was tested by rival American Motors (AMC) where in addition to crash-testing, engineers specialized in fuel-system performance because of the potential deadly fires in severe collisions.[19]

Ford also tested several different vehicle modifications that could improve rear impact performance.[20] However, the engineer's occupational caution and aversion to "unproven" solutions, as well as a view that the crash test results were inconclusive, resulted in the use of a conventional fuel tank design and placement.[21][22] The use of an above-the-axle tank location was considered safer by some, but not all, at Ford. This placement was not a viable option for the hatchback and station wagon body styles.[23]

Beginning in 1973, field reports of Ford Pintos consumed by fire after low-speed rear-end collisions were received by Ford's recall coordinator office.[24] Based on standard procedures used to evaluate field reports, Ford's internal recall evaluation group twice reviewed the field data and found no actionable issue.[25]

Cost–benefit analysis, the Pinto Memo

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In 1973, Ford's Environmental and Safety Engineering division developed a cost–benefit analysis entitled Fatalities Associated with Crash Induced Fuel Leakage and Fires for submission to the NHTSA in support of Ford's objection to proposed stronger fuel system regulation.[26] The document has become known as the Grush/Saundy Report, named for its authors,[27] and as the "Pinto Memo".[28] Cost–benefit analysis was one tool used in the evaluation of safety design decisions accepted by the industry and the NHTSA.[29] The analysis compared the cost of repairs to the societal costs for injuries and deaths related to fires in cases of vehicle rollovers for all cars sold in the US by all manufacturers. The values assigned to serious burn injuries and loss of life were based on values calculated by NHTSA in 1972.[30] In the memo Ford estimated the cost of fuel system modifications to reduce fire risks in rollover events to be $11 per car across 12.5 million cars and light trucks (all manufacturers), for a total of $137 million. The design changes were estimated to save 180 burn deaths and 180 serious injuries per year, a benefit to society of $49.5 million.

In August 1977, having been provided with a copy of the memo by Grimshaw v. Ford Motor Co. plaintiffs before trial,[31][32] Mark Dowie's investigative article "Pinto Madness", published in Mother Jones magazine, emphasized the emotional aspects of the Grush/Saundy Report and implied Ford was callously trading lives for profits.[33] The Mother Jones article also erroneously claimed that somewhere between 500 and 900 persons had been killed in fires attributed to the Pinto's unique design features.[34]

The public understanding of the cost–benefit analysis has contributed to the mythology of the Ford Pinto case. Time magazine said the memo was one of the automotive industry's "most notorious paper trails."[35] A common misconception is that the document considered Ford's tort liability costs rather than the generalized cost to society and applied to the annual sales of all passenger cars, not just Ford vehicles. The general misunderstanding of the document, as presented by Mother Jones, gave it an operational significance it never had.[36][37]

NHTSA investigation

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In April 1974, the Center for Auto Safety petitioned the National Highway Traffic Safety Administration (NHTSA) to recall Ford Pintos to address fuel system design defects after reports from attorneys of three deaths and four serious injuries in rear-end collisions at moderate speeds.[38][39] The NHTSA found there was not enough evidence to warrant a defect investigation.[38][40] In August 1977, Dowie's "Pinto Madness" article was published, leveling a series of accusations against Ford, the Pinto and the NHTSA. These included that Ford knew the Pinto was a "firetrap" and said that Ford did not implement design changes because the company's cost–benefit analysis document showed that paying out millions in damages in lawsuits was less expensive than the design changes.[41] The day after the article's release consumer advocate Ralph Nader and the author of the Mother Jones article held a news conference in Washington DC on the alleged dangers of the Pinto's design.[42] On the same day, Nader and the Center for Auto Safety re-submitted their petition to the NHTSA.[43]

Former UCLA law professor Gary T. Schwartz in a Rutgers Law Review article said the NHTSA investigation of the Pinto was in response to consumer complaints and noted the Mother Jones article included a clip out "coupon" that readers could mail to the NHTSA.[44] Lee and Ermann note that the Mother Jones labeling of the Pinto as a "firetrap" and accusations that the NHTSA was buckling to industry pressure as well as the public interest created by sensationalized news stories "forced a second Pinto investigation and guaranteed that the NHTSA would be under the microscope for its duration."[45]

On August 11, 1977, the day after the Nader and Mother Jones press conference, the NHTSA initiated an investigation.[46] On May 8, 1978, the NHTSA informed Ford of their determination that the Pinto fuel system was defective.[47] The NHTSA concluded:

1971–1976 Ford Pintos have experienced moderate speed, rear-end collisions that have resulted in fuel tank damage, fuel leakage, and fire occurrences that have resulted in fatalities and non-fatal burn injuries ... The fuel tank design and structural characteristics of the 1975–1976 Mercury Bobcat which render it identical to contemporary Pinto vehicles, also render it subject to like consequences in rear-impact collisions.[48][49]

NHTSA scheduled a public hearing for June 1978, and NHTSA negotiated with Ford on the recall.[50]

Lee and Ermann noted that NHTSA used a worst-case test to justify the recall of the Pinto, rather than the regular 1977 rear-impact crash test. A large "bullet car" was used instead of a standard moving barrier. Weights were placed in the nose of the car to help it slide under the Pinto and maximize gas tank contact. The vehicle headlights were turned on to provide a possible ignition source. The fuel tank was completely filled with gasoline rather than partially filled with non-flammable Stoddard fluid as was the normal test procedure. In a later interview, the NHTSA engineer was asked why the NHTSA forced a Pinto recall for failing a 35 mph test given that most small cars of the time would not have passed. "Just because your friends get away with shoplifting, doesn't mean you should get away with it too."[51][52]

The National Highway Traffic Safety Administration (NHTSA) ultimately directed Ford to recall the Pinto. Initially, the NHTSA did not feel there was sufficient evidence to demand a recall due to incidents of fire. The NHTSA investigation found that 27 deaths were found to have occurred between 1970 and mid-1977 in rear-impact crashes that resulted in a fire. The NHTSA did not indicate if these impacts would have been survivable absent fire or if the impacts were more severe than even a state of the art (for 1977) fuel system could have withstood.[53] In their analysis of the social factors affecting the NHTSA's actions, Lee and Ermann note that 27 is the same number of deaths attributed to a Pinto transmission problem which contributed to collisions after the affected cars stalled.[54] They also note that the NHTSA had two primary incentives in proving a defect existed in the Pinto's fuel system design. The administration was pressured by safety advocates (Center for Auto Safety) as well as the public response. It was also being forced into action due to the ways in which both the courts and executive branch were limiting the ability of the NHTSA to address systematic auto safety issues.[55]

Recall

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Though Ford could have proceeded with the formal recall hearing, fearing additional damage to the company's public reputation the company agreed to a "voluntary recall" program.[56] On June 9, 1978, days before the NHTSA was to issue Ford a formal recall order, Ford recalled 1.5 million Ford Pintos and Mercury Bobcats, the largest recall in automotive history at the time.[57] Ford disagreed with the NHTSA finding of a defect, and said the recall was to "end public concern that has resulted from criticism of the fuel systems in these vehicles."[58] The Ford recall placed a polyethylene shield between the tank and likely causes of puncture, lengthened the filler tube, and improved the tank filler seal in the event of a collision.[59]

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Approximately 117 lawsuits were brought against Ford in connection with rear-end accidents in the Pinto.[60] The two most significant cases were Grimshaw v. Ford Motor Company and State of Indiana v. Ford Motor Company.[61]

Grimshaw v. Ford Motor Co.

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Grimshaw v. Ford Motor Co., decided in February 1978, is one of two important Pinto cases.[7] A 1972 Pinto driven by Lily Gray stalled in the center lane of a California freeway. The car was struck from behind by a vehicle initially traveling at 50 mph and impacted at an estimated between 30 and 50 mph, resulting in a fuel tank fire.[62] Gray died at the time of the impact. Richard Grimshaw, the thirteen-year-old passenger, was seriously burned.[63][64] The plaintiff's bar collaborated with Mother Jones and The Center for Auto Safety to publicize damning information about Ford prior to trial.[31][65] The jury awarded $127.8 million in total damages; $125 million in punitive damages and $2,841,000 in compensatory damages to passenger Richard Grimshaw and $665,000 in compensatory damages to the family of the deceased driver, Lily Gray. The jury award was said to be the largest ever in US product liability and personal injury cases.[66] The jury award was the largest against an automaker at the time.[67] The judge reduced the jury's punitive damages award to $3.5 million, which he later said was "still larger than any other punitive damage award in the state by a factor of about five."[68] Ford subsequently decided to settle related cases out of court.[69]

Reaction to the Grimshaw case was mixed. According to the Los Angeles Times in 2010, the award "signaled to the auto industry that it would be harshly sanctioned for ignoring known defects."[70] The case has been held up as an example of the disconnection between the use of corporate risk analysis and the tendency of juries to be offended by such analyses.[71] The case is also cited as an example of irrational punitive damage awards.[72] While supporting the finding of liability, Schwartz notes that the punitive damage award is hard to justify.[73][74]

Indiana v. Ford Motor Co.

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On August 10, 1978, three teenage girls of the Ulrich family of Osceola, Indiana, were killed when the 1973 Pinto they were in was involved in a rear-end collision. The driver had stopped in the road to retrieve the car's gas cap which had been inadvertently left on the top of the car and subsequently fell onto the road. While stopped the Pinto was struck by a Chevrolet van.[75] Ford sent the Ulrichs a recall notice for the Pinto in 1979. A grand jury indicted Ford on three counts of reckless homicide. Indiana v. Ford was a landmark in product liability law as the first time a corporation faced criminal charges for a defective product, and the first time a corporation was charged with homicide.[76] If convicted, Ford faced a maximum fine of $30,000 under Indiana's 1978 reckless homicide statute.[77] Ford's legal defense was vastly more ambitious than the effort mounted in the Grimshaw case.[78] The effort was led by James F. Neal with a staff of 80 and a budget of about $1 million; the Elkhart County Prosecuting Attorney had a budget of about $20,000 and volunteer law professors and law students.[79] A former head of the NHTSA, testifying on Ford's behalf, said the Pinto's design was no more or less safe than that of any other car in its class.[80] In 1980 Ford was found not guilty.[77] In 1980 a civil suit was settled for $7,500 to each plaintiff.[81]

According to Automotive News in 2003, the indictment was a low point in Ford's reputation.[82] Some saw the suit as a landmark for taking a corporation to task for their actions while others saw the case as frivolous.[83][84] In 2002, Malcolm Wheeler, a lawyer working with the Ford defense team, noted that the case was a poor application of criminal law.[85] The case also impacted how Ford handled future product liability cases both legally and in the press.[86]

Retrospective safety analysis

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A Rutgers Law Review article by former UCLA law professor Gary T. Schwartz (see Section 7.3 NHTSA Investigation above), examined the fatality rates of the Pinto and several other small cars of the time period. He noted that fires, and rear-end fires, in particular, are a very small portion of overall auto fatalities. At the time only 1% of automobile crashes would result in fire and only 4% of fatal accidents involved fire, and only 15% of fatal fire crashes are the result of rear-end collisions.[87] When considering the overall safety of the Pinto, subcompact cars as a class have a generally higher fatality risk. Pintos represented 1.9% of all cars on the road in the 1975–76 period. During that time, the car represented 1.9% of all "fatal accidents accompanied by some fire." This implies the Pinto was average for all cars and slightly above average for its class.[88] When all types of fatalities are considered, the Pinto was approximately even with the AMC Gremlin, Chevrolet Vega, and Datsun 510. It was significantly better than the Datsun 1200/210, Toyota Corolla, and VW Beetle.[87] The safety record of the car in terms of fire was average or slightly below average for compacts, and all cars respectively. This was considered respectable for a subcompact car. Only when considering the narrow subset of rear-impact, fire fatalities for the car were somewhat worse than the average for subcompact cars. While acknowledging this is an important legal point, Schwartz rejected the portrayal of the car as a firetrap.[89]


References

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  1. ^ Lee & Ermann 1999: The Pinto story has become a landmark narrative" (Nichols 1997:324), a definitive story used to support the construction of amoral corporate behavior as a pervasive social problem. This narrative was first stated publicly by investigative journalist Mark Dowie (1977) in a scathing Pulitzer Prize-winning exposé, "Pinto Madness," published in Mother Jones magazine.
  2. ^ Bazerman, Max H.; Tenbrunsel, Ann E. (April 2011). "Ethical Breakdowns". Harvard Business Review. 89 (4): 58–65, 137. PMID 21510519. Retrieved February 28, 2015.
  3. ^ Birsch, Douglas (October 25, 1994). The Ford Pinto Case.
  4. ^ Woodyard, Chris (March 28, 2011). "Case: Lee Iacocca's Pinto: A fiery failure". USA Today.
  5. ^ Kitman, Jamie (March 24, 2011). "Don't Like Government Regulation? How'd You Like Another Pinto?". Cartalk.com.
  6. ^ Lee & Ermann 1999: Conventional wisdom holds that Ford Motor Company decided to rush the Pinto into production in 1970 to compete with compact foreign imports, despite internal pre-production tests that showed gas tank ruptures in low-speed rear-end collisions would produce deadly fires. This decision purportedly derived from an infamous seven-page cost-benefit analysis (the "Grush/Saunby Report" [1973]) that valued human lives at $200,000. Settling burn victims' lawsuits would have cost $49.5 million, far less than the $137 million needed to make minor corrections. According to this account, the company made an informed, cynical, and impressively coordinated decision that "payouts" (Kelman and Hamilton 1989:311) to families of burn victims were more cost-effective than improving fuel tank integrity. This description provides the unambiguous foundation on which the media and academics have built a Pinto gas tank decision-making narrative.
  7. ^ a b Danley 2005
  8. ^ Schwartz 1991
  9. ^ Schwartz 1991: Having reflected on these invocations of the Ford Pinto case, I have arrived at two general observations. One is that several significant factual misconceptions surround the public's understanding of the case. Given the cumulative force of these misconceptions, the case can be properly referred to as "mythical."
  10. ^ Rossow 2015:'Fixed-barrier' meant that the vehicle was moving (towed backwards) into a stationary barrier ... The 20-mph fixed barrier standard was greeted with uniform opposition from the auto industry because it was a much more severe test than the moving-barrier standard.
  11. ^ Lee & Ermann 1999: pg 36, 43
  12. ^ Lee & Ermann 1999: In the design stage (1967–1970), no company or government standard on rear-end fuel tank integrity existed to guide the engineers, but their actions were consistent with the taken-for-granted, industry-wide tradition of building lower levels of crashworthiness into small cars. This situation changed in the marketing stage (post 1970). Shortly after the 1971 model year, Pintos were released, Ford adopted an internal20 mile-per-hour moving barrier standard for the 1973 model year-the only manufacturer to do so (Gioia 1996; Strobel 1994). The extant legal/regulatory environment reinforced engineers' beliefs that this standard was quite reasonable" since it was the "same one recommended at that time by the federal General Services Administration; the Canadian equivalent of the GSA; the Society of Automotive Engineers; and a private consulting firm hired by NHTSA ..." and by NHTSA itself in 1969 (Strobel 1980:205). This standard would constrain future debates by certifying the Pinto as safe" to Ford's subunit charged with evaluating potential recallable safety problems.
  13. ^ Schwartz 1991: In August 1970, 1971 model-year Pintos began coming off the assembly line. Just a few days later, NHTSA-which had never acted on its earlier proposal-advanced a more demanding set of proposed regulations. Three months later, Ford officials decided that for purposes of the 1973 model year, Ford would adopt, as its own internal objective, the regulations that NHTSA had suggested in 1969. In order to respond to NHTSA's more recent proposal, Ford engineers, with actual Pintos now available, stepped up the crash-testing process and identified a number of design modifications that might improve the Pinto's performance. In October 1971, Ford officials decided against incorporating any of these modifications into current Pintos; rather, it would wait until NHTSA clarified its position. In 1973, NHTSA promulgated its fuel-tank standard but ruled that this standard would apply only to 1977 models. Ford adopted a 20 mph moving-barrier standard for all 1973 cars.
  14. ^ Strobel 1979: Ford then joined other automakers in an aggressive lobbying campaign that was successful in delaying and softening proposed federal standards on how strong fuel systems must be to resist rupture and potential explosion.
  15. ^ Gioia 1992: The tank was positioned between the rear bumper and the rear axle (a standard industry practice for the time).
  16. ^ Schwartz 1991: Page 1015 and Footnote 9, "The court of appeal opinion referred to the Pinto's bumper as the flimsiest of any American car. Grimshaw, 119 Cal. App. 3d at 774, 174 Cal. Rptr. at 360. Mark Robinson, Jr., co-counsel for the plaintiffs, is emphatic that this reference is correct. Telephone interview with Mark Robinson, Jr. (Sept. 12, 1990) [hereinafter Robinson Interview). In the later criminal case, however, Byron Bloch, a prosecution witness, stated in cross-examination that the Pinto's bumper was about the same as those of the Gremlin, Vega, and Dodge Colt. See L. Strobel, supra note 5, at 157 ("I would say they were all bad.")."
  17. ^ Danley 2005: A few months later Ford began crash-testing modified Mavericks In part to prepare a response to NHTSA'S proposed regulations. The results demonstrated the vulnerability of fuel-integrity at fairly low speeds and some modifications were made. In August of 1970, the first model year Pinto, the 1971, went into production. Post-production testing revealed similar results. Still, there were no federal performance standards at the time and the proposed regulations addressed only front-end collisions.
  18. ^ Lee & Ermann 1999: engineers In the design stage were still trying "to find out how to conduct crash tests" (Feaheny 1997; see also Lacey 1986:613). For example, an internal Pinto test report dated November 1970 listed as its objective "To develop a test procedure to Be used to provide baseline data on vehicle fuel system integrity" (NHTSA C7−38-Al.5, Final Test Report #T-0738). In this test, a Pinto sedan exhibited "excessive fuel tank leakage" when towed rearward into a fixed barrier at 21.5 miles per hour, considered roughly equivalent to a car-to-car impact At 35 miles per hour. Nothing in this, or any other, Ford test report indicates that participants felt cause for concern or organizational action. Although some Ford engineers were not especially pleased, they felt that the data were inconclusive or the risks acceptable (Feaheny 1997; Strobel 1980), or they kept their concerns to themselves (Camps 1997). Some felt that cars would rarely be subjected to the extreme forces generated In a fixed-barrier test In real-world collisions (Feaheny 1997; Devine 1996). NHTSA apparently agreed and ultimately replaced the proposed fixed barrier test with a less-stringent moving-barrier test In its final standard (U.S. Department of Transportation 1988)
  19. ^ Foster, Pat (February 2021). "A look back at the development of American Motors' crash-testing program". Hemmings Classic Car. Retrieved 31 December 2020.
  20. ^ Gioia 1992: Ford had in fact crash-tested 11 vehicles; 8 of these cars suffered potentially catastrophic gas tank ruptures. The only 3 cars that survived intact had each been modified in some way to protect the tank.
  21. ^ Lee & Ermann 1999: Occupational caution encouraged engineers to view many design adjustments that improved test performance as "unproven" in real-world accidents (Devine 1996; Feaheny 1997; Schwartz 1991; Strickland 1996; Strobel 1980). Engineers, who typically value "uncertainty avoidance" (Allison 1971:72 ), chose to stick with an existing design rather than face uncertainties associated with novel ones (Devine 1996; Strobel 1980). One series of tests, for instance, showed that Pintos equipped with pliable foam-like gas tanks would not leak in 30 mile-per-hour crashes. But some engineers feared that such a tank might melt and disagreed with others who felt it was safer than the existing metal design (Devine 1996, see also Strobel 1980). Other engineers believed that rubber bladders improved performance in tests, but anticipated problems under real-world conditions (Strobel 1980).
  22. ^ Schwartz 1991: As for additional design proposals brought forward by the plaintiffs, several of them-for example, a bladder within the gas tank, and a "tank within the tank"-concerned somewhat innovative technology that had never been utilized in actual auto production. At trial, there was testimony that a bladder would have been feasible in the early 1970s, but also rebuttal testimony that a bladder was at this time beyond the bounds of feasibility.
  23. ^ Lee & Ermann 1999: Ford whistle-blower Harley Copp's argument-that the Pinto would have been safer had its gas tank been placed above the axle rather than behind it-is often cited in Pinto narratives as an example of safety being sacrificed to profits, or at least trunk space, in the design stage (Cullen, Maakestad and Cavender 1987; Dowie 1977; Strobel1994). Yet Copp did not reach this conclusion until 1977 (Strobel1980). And other engineers were considerably less certain about it, even though the above-the-axle design did perform better in one set of crash tests. The engineer overseeing the Pinto's design, Harold MacDonald (whose father died in a fuel tank fire when his Model A Ford exploded after a frontal collision with a tree), felt that the above-the axle placement was less safe under real-world conditions because the tank was closer to the passenger compartment and more likely to be punctured by items in the trunk (Strobel1980).
  24. ^ Gioia 1992: I began to construct my own files of incoming safety problems. One of these new files concerned reports of Pintos "lighting up" (in the words of a field representative) in rear-end accidents. There were actually very few reports, perhaps because component failure was not initially assumed. These cars simply were consumed by fire after apparently very low-speed accidents.
  25. ^ Lee & Ermann 1999: When Gioia became Recall Coordinator, he inherited about 100 active recall campaigns, half of them safety-related. As with most jobs, the enormous workload required him to use standard operating procedures" (SOPs) to organize and manage information for decision making (d. Kriesberg 1976:1102). SOPs increase organizational efficiency by operating as cognitive scripts that transform decision-making opportunities into largely predetermined action patterns. Existing SOPs required that, to be "recallable," problems needed either high frequency or a directly traceable causal link to a design defect. When reports began to trickle in to Gioia that Pintos were "lighting up" in relatively low-speed accidents, and after viewing the burned wreckage of a Pinto, he initiated a meeting to determine if this represented a recallable problem. His workgroup voted unanimously not to recall the Pinto because the weak data did not meet SOP criteria (Gioia 1996). The workgroup was unaware of any cost-benefit analyses or Pinto crash test results. Reports of Pinto fires continued to trickle in, and eventually, Gioia did become aware of and concerned about the crash test results. Again he wondered if the Pinto had a recallable problem, so he initiated a second meeting to convince his co-workers that crash tests showed a possible design flaw. But others again saw no design flaws—after all, the Pinto met internal company standards, and no contradictory external standard existed. The workgroup conceived the tank leak "problem" not as a defect, but as a fundamental and unalterable design feature: the car's small size, the use of light metals, and unibody construction produced a tendency for Pintos (and others in its class) to "crush up like an accordion" in rear-end collisions (Gioia 1996).
  26. ^ Grush, E.S.; Saundy, C.S. Fatalities Associated With Crash Induced Fuel Leakage and Fires (PDF) (Report). Ford Environmental and Safety Engineering. Retrieved March 2, 2016.
  27. ^ Danley 2005
  28. ^ Rossow 2015
  29. ^ Gioia 1992: The National Highway Traffic Safety Association (NHTSA, a federal agency) had approved the use of cost-benefit analysis as an appropriate means for establishing automotive safety design standards.
  30. ^ Danley 2005: In calculating the benefits, the analysis used a figure of $200,000 per life. NHTSA had developed this figure in 1972.
  31. ^ a b Frank, Ted. "Rollover Economics: Arbitrary and Capricious Product Liability Regimes". American Enterprise Institute for Public Policy Research.
  32. ^ Lee & Ermann 1999: Based on information given to it by lawyers preparing cases against Ford, the Center for Auto Safety petitioned NHTSA in the mid-1970s to investigate the Pinto's rear-end design. According to material presented on the Center's website, Dowie's article is based on that information, made available to him by the Center (www.autosafety.org). "Pinto Madness" is still available on the Mother Jones website along with a video clip showing a Pinto catching fire after being rear-ended. In an interview with Gary T. Schwartz of the Rutgers Law Review, Copp asserted that he was also a major source of the information for the Mother Jones story, Schwartz, "The Myth of the Ford Pinto Case," 1027, n.53
  33. ^ Schwartz 1991:The Mother Jones article is suffused with an outrage at companies that apply a pernicious cost-benefit analysis in order to achieve "corporate profits".
  34. ^ Schwartz 1991: According to the Mother Jones article, as of 1977, somewhere between 500 and 900 persons had been killed in fires attributed to the Pinto's unique design features
  35. ^ Cite error: The named reference time20070907 was invoked but never defined (see the help page).
  36. ^ Schwartz 1991:To sum up, the Ford document has been assigned an operational significance that it never possessed, and has been condemned as unethical on account of characterizations of the document that are in significant part unwarranted. Of course, the condemnation of Ford's report is linked to the condemnation imposed by the public on the Pinto itself. The common belief is that the Pinto, on account of its fuel-tank design, was a "firetrap." The Mother Jones article derived emotional power from its presentation of the Pinto as a "firetrap, a "death trap," and a "lethal car."47 The combination of that article, the verdict in the Ford Pinto case, the NHTSA initial determination, and the Pinto recall clearly conveyed this sense of the Pinto-as-firetrap to the general public.
  37. ^ Lee & Ermann 1999: Dowie (1977) accurately explains in part of his Mother Jones article that Ford employees wrote this document as part of an ongoing lobbying effort to influence NHTSA (24, 28). But his readers have relied exclusively on his other claim, that it was the "internal" (20, 24) memo on which Ford based its decision to market the dangerous Pinto and settle the few inevitable lawsuits (31).
  38. ^ a b Graham, John D. (1991). Huber, Peter W.; Litan, Robert E. (eds.). "Does liability promote the safety of motor vehicles?". The Liability Maze: The Impact of Liability Rules on Innovation and Safety. Washington DC: Brookings Institution: 132.
  39. ^ Weiss, Joseph W. (2014). Business Ethics: A Stakeholder and Issues Management Approach. Berrett-Koehler Publishers. ISBN 978-1-62656-141-0.
  40. ^ Lee & Ermann 1999:pg 41
  41. ^ Dowie 1977: Ford knows the Pinto is a firetrap, yet it has paid out millions to settle damage suits out of court, and it is prepared to spend millions more lobbying against safety standards ... Ford waited eight years because its internal "cost-benefit analysis," which places a dollar value on human life, said it wasn't profitable to make the changes sooner.
  42. ^ Dardis & Zent 1982: On August 10, 1977, Ralph Nader and Mark Dowie held a press conference to notify the public that unnecessary deaths and injuries were being suffered as a result of the faulty design of the pre-1977 model year Pinto.
  43. ^ Center for Auto Safety 2009
  44. ^ Schwartz 1991: Pg 1019, Schwartz noted, "The Mother Jones article had encouraged consumers to write to NHTSA and demand a recall of earlier Pintos. Responding to the wave of consumer complaints it received, NHTSA began a recall proceeding relating to 1971–1976 Pintos." Also see footnote 15.
  45. ^ Lee & Ermann 1999: By 1977, the social context had changed. Dowie's (1977:18) article had labeled the Pinto a "firetrap" and accused the agency of buckling to auto-industry pressure. Public interest generated by the article forced a second Pinto investigation and guaranteed that NHTSA would be under a microscope for its duration.
  46. ^ Dardis & Zent 1982: On August 11, the National Highway Traffic Safety Administration (NHTSA) began an investigation of the claims.
  47. ^ Jones 1978: But NHTSA, a Department of Transportation agency, informed Ford on May 8 about the results of the new investigation, which concluded that Pintos had a safety defect.
  48. ^ Dardis & Zent 1982: In May 1978, NHTSA determined that pre-1977 model year Ford Pintos were subject to "fuel tank damage, Fuel leakage and fire occurrences which had resulted in fatalities and non-fatal burn injuries" when impacted at "moderate speeds," and that the "fire threshold" in those vehicles was reached at closing speeds of 30–35 MPH.
  49. ^ Investigative Report: Alleged Fuel Tank and Filler Neck Damage in Rear-end Collisions of Subcompact Cars Passenger Cars, 1971–1976 Ford Pinto, 1975–1976 Mercury Bobcat (PDF) (Report). Office of Defects Investigation, National Highway Traffic Safety Administration. May 1978. Retrieved March 5, 2016. Based upon the information either developed or acquired during this investigation, the following conlcusions have been reached: 1971–1976 Ford Pintos have experienced moderate speed, rear-end collisions that have resulted in fuel tank damage, fuel leakage, and fire occurrences that have resulted in fatalities and non-fatal burn injuries.
  50. ^ Jones 1978: A spokesman for NHTSA said that his agency and Ford began a "process of negotiation" after May 8 that led to Ford's announcement in Detroit yesterday.
  51. ^ Lee & Ermann 1999: NHTSA engineer Lee Strickland was assigned to determine if Pinto (and Chevrolet Vega) tank problems warranted a mandatory recall. Strickland's workgroup held the Pinto and Vega to a higher standard than other cars (Strickland 1996). It dispensed with the usual moving barrier. Instead, it intentionally selected a large and particularly rigid "bullet car" to hit the Pinto's rear end. It weighed down the bullet car's nose to slide under the Pinto and maximize gas tank contact. It also turned on the bullet car's headlights to provide a ready source of ignition. And it completely filled gas tanks in both cars with gasoline rather than the non-flammable Stoddard fluid normally used. Strickland justified these actions as approximating real-world worst-case circumstances (Davidson 1983; NHTSA C7-38; Strickland 1996). For NHTSA, the tests seemed an unqualified success: two 1972 Pintos burst into flame upon impact. In the summer of 1978, NHTSA announced that the Pinto gas tank represented a safety defect, leading to the largest recall campaign in automobile history at that time (NHTSA C7-38; Strickland 1996). Ford agreed to "voluntarily" recall 1971–1976 Pintos. Other small cars sold during the 19 70s were not recalled, even though most were comparable, or in the case of the AMC Gremlin probably less safe (Schwartz 1991; NHTSA C7-38; Swigert and Farrell 198081:180). Their manufacturers successfully defended them as acceptable risks (see Wallace 1978). When we asked why NHTSA forced a Pinto recall for failing the 35 mile-per-hour test, although most small cars could not withstand such a test, Strickland ( 1996) analogized that, "Just because your friends get away with shoplifting, doesn't mean you should get away with it too."
  52. ^ Lee, Matthew T (1998). "The Ford Pinto Case and the Development of Auto Safety Regulations, 1893—1978". Business and Economic History. 27 (2): 390–401.
  53. ^ Schwartz 1991: Relying on a variety of external sources (including Ford), NHTSA indicated that it was aware of thirty-eight instances in which rear-end impact on Pintos had resulted in fuel-tank leakage or fire; these instances, in turn, resulted in twenty-seven deaths and twenty-four nonfatal burn injuries.66 The NHTSA report also incorporated the data internally provided by NHTSA's own Fatal Accident Reporting System ("FARS"), which had begun operation in 1975. FARS data showed that from January 1975 through the middle of 1977, seventeen people had died in accidents in which Pinto rear-end collisions resulted in fires. 67 In comparing NHTSA's figure of twenty-seven deaths for 1971–77 with the FARS figure of seventeen for 1975–77,68 one should keep in mind that the number of Pintos on the road was increasing every year in a cumulative way. The NHTSA figure of twenty-seven fatalities hence seems roughly in the ballpark by way of suggesting the number of people who had died in Pinto rear-end fires. In setting forth this number, however, NHTSA made no effort to estimate how many of these deaths were caused by the Pinto's specific design features. Many fire deaths undeniably result from high-speed collisions that would induce leakage even in state-of-the-art fuel systems;69 moreover, cars in the subcompact class generally entail a relatively high fatality risk.70 Yet the NHTSA report did not compare the performance results of the Pinto to the results of other cars then on the road, including other subcompacts.
  54. ^ Lee & Ermann 1999: Beginning in the late 1970s, claims consistent with "Pinto Madness" readily gained public acceptance, but credible contradictory claims did not (e.g., Davidson 1983; Epstein 1980). For instance, Dowie's "conservative" estimate of 500 deaths (1977:18) was accepted, while NHTSA's report that it could document only 27 Pinto fire-related deaths (NHTSA C7-38; Frank 1985) was ignored. A transmission problem that also caused 27 Pinto deaths (and 180 on other Ford products [Clarke 1988]) never became a social problem. Similarly, the public accepted claims of safety errors leveled by Harley Copp, a Ford engineer who was apparently overseas when early crucial decisions were made (Camps 1997; Strobel 1980) but ignored other safety-conscious Pinto engineers who believed windshield retention was a more important safety problem (Camps 1997), and lack of safety glass caused more deaths (Feaheny 1997).
  55. ^ Lee & Ermann 1999: By the time of its Pinto investigation, NHTSA had essentially abandoned its original mission of forcing industry-wide safety improvements, in favor of investigating and recalling specific cars (Mashaw and Harfst 1990). NHTSA had two primary incentives in reinforcing the extant Nfocal organization" imagery of the Pinto narrative. First, NHTSA was pressured by specific organizations in its network (e.g., the Center for Auto Safety) and members of the public (see NHTSA C7-38) to take action on the Pinto's gas tank. Second, other network actors (e.g., courts, the Nixon administration, the auto industry) had increasingly limited NHTSA's ability to address systemic auto safety issues.
  56. ^ Danley 2005: Ford could have refused to recall and have chosen instead to defend the Pinto's design in the formal recall hearings at NHTSA." While this tactic could easily have delayed any forced recall for months, if not for more than a year, the cost of the publicized hearings to Ford's reputation could have been substantial, even if Ford had been successful in the end. Ford agreed to "voluntarily recall" the Pinto in June 1978.
  57. ^ Lee & Ermann 1999: the Pinto was the subject of the largest recall in automobile history at the time.
  58. ^ Jones 1978: In a prepared statement, Ford vice President Herbert L. Misch said: "Ford informed NHTSA that it does not agree with the agency's initial determination of May 8 that an unreasonable risk of safety is involved in the design of these cars ..." Misch said Ford decided to offer the modifications "so as to end public concern that has resulted from criticism of the fuel systems in these vehicles".
  59. ^ "1975 FORD PINTO". NHTSA.
  60. ^ Sherefkin 2003: Ford customers filed 117 lawsuits, according to Peter Wyden in The Unknown Iacocca.
  61. ^ Danley 2005: Two important legal cases were central. One was a civil trial that began in August 1977 in Orange County California, Grimshaw v. Ford Motor Company. The other was a case involving criminal reckless homicide in Indiana.
  62. ^ Schwartz 1991: The Pinto was then struck by a car, which had originally been traveling at about fifty miles per hour but which had braked down to a speed of perhaps thirty miles per hour at the point of impact.9 ... [footnote 9] For reasons quite beyond the court's control, its opinion must be treated cautiously as a source of actual facts. Because the defendant was appealing a jury verdict in favor of the plaintiffs, the court was under an obligation to view all the evidence in a way most favorable to the plaintiffs and essentially to ignore evidence in the record that might be favorable to the defendant. See id. at 773, 820, 174 Cal. Rptr. at 359, 388. In fact, Ford's basic position at trial-which the court's opinion at no point mentions was that the approaching car (a Ford Galaxie) had not slowed down at all, and had struck the Gray car at a speed in excess of 50 miles per hour. There was an enormous amount of evidence at trial supporting each of the parties' factual claims as to the Galaxie's closing speed. Had the jury accepted Ford's speed estimate, there would not have been much of an issue of crashworthiness: for the plaintiffs' position throughout the trial was that even a state-of-the-art fuel system could not maintain integrity in a 50 mile-per-hour collision.
  63. ^ Danley 2005: pg 208
  64. ^ Schwartz 1991:pg 1016
  65. ^ Lee & Ermann 1999: Based on information given to it by lawyers preparing cases against Ford, the Center for Auto Safety petitioned NHTSA in the mid-1970s to investigate the Pinto's rear-end design. According to material presented on the Center's website, Dowie's article is based on that information, made available to him by the Center (www.autosafety.org). "Pinto Madness" is still available on the Mother Jones website along with a video clip showing a Pinto catching fire after being rear-ended. In an interview with Schwartz, Copp asserted that he was also a major source of the information for the Mother Jones story, Schwartz, "The Myth of the Ford Pinto Case," 1027, n.53
  66. ^ Schwartz 1991: after deliberating for eight hours-awarded the Gray family wrongful death damages of $560,000; Grimshaw was awarded over $2.5 million in compensatory damages and $125 million in punitive damages as well. The trial judge reduced the punitive damage award to $3.5 million as a condition for denying a new trial. Two years later the court of appeal affirmed these results in all respects; the state supreme court then denied a hearing.
  67. ^ Christian, Nichole M; Henderson, Angelo B; Nomani, Asra Q (October 9, 1997). "Chrysler is Told to Pay $262.5 Million by Jurors in Minivan-Accident Trial". The Wall Street Journal. p. 1. Retrieved March 4, 2016.
  68. ^ McLellan, Dennis (April 19, 2008). "Retired O.C. judge handled major cases". Los Angeles Times. Retrieved March 4, 2016.
  69. ^ Danley 2005: pg 209
  70. ^ Williams, Carol J. (March 14, 2010). "Toyota is just the latest automaker to face auto safety litigation". Los Angeles Times. Retrieved March 4, 2016.
  71. ^ Viscusi, W. Kip (February 2000). "Corporate Risk Analysis: A Reckless Act?" (PDF). Stanford Law Review. 52 (3): 569. doi:10.2307/1229473. hdl:1803/6556. JSTOR 1229473. The basic problem is that jurors do not undertake a comprehensive risk analysis approach, regardless of its character. Jurors have a tendency to compare the often very small per-unit safety cost with the costs borne by the injured victim. Rather than examine the entire market and the associated benefits and costs, jurors will be offended by, or will not fully understand, a comprehensive risk-analysis approach and will focus their assessment more narrowly on the identified victim and the costs of preventing that injury. The fact that these costs would also have been incurred for thousands of consumers who were not injured will not loom as large, as Judge Easterbrook emphasized. Thus, there is a tendency to exhibit "hindsight bias" rather than to consider the expected costs and expected benefits at the time of the safety decision.
  72. ^ Viscusi, W. Kip (February 2000). "Corporate Risk Analysis: A Reckless Act?" (PDF). Stanford Law Review. 52 (3): 569. doi:10.2307/1229473. hdl:1803/6556. JSTOR 1229473.
  73. ^ Schwartz, Gary T. (1982–1983). "Deterrence and Punishment in the Common Law of Punitive Damages: A Comment". Southern California Law Review: 134. The Court of Appeal's opinion thus suggested that the Court would have been equally willing to have affirmed the trial judge's decision had he either accepted the jury's $125 million award or reduced the award to $1 million. From a deterrence standpoint, it confounds understanding to permit such vast uncertainty as to the level of the expected penalty.
  74. ^ Schwartz 1991: Hence, there was nothing clearly wrong in subjecting Ford to liability for harms resulting from that latter category of fires. The punitive damage award in the Ford Pinto case is, however, much more difficult to justify. To a large extent, it rested on the premise that Ford had behaved reprehensibly when it balanced safety against cost in designing the Pinto. However, the process by which manufacturers render such trade-off design decisions seems not only to be anticipated but endorsed by the prevailing risk-benefit standard for design liability. Accordingly, the Pinto jury's decision that punitive damages were appropriate-a decision that was affirmed by the trial judge and the court of appeal-raises serious questions about the operational viability of the risk-benefit standard itself.
  75. ^ Epstein 1980
  76. ^ Becker, Jipson & Bruce 2002: There is little doubt about the importance of State of Indiana v. Ford Motor Company from a legal standpoint. This case was the first time criminal charges were bought against an American corporation for faulty product design. According to attorney Malcolm Wheeler (1981, p. 250), "[n]ewspapers referred to it as the most important economic case of the century ..." The notion that a corporation could be held accountable for its criminal actions was a novel legal concept at the time. Wheeler was not alone in his estimation of the case as influential. Because of the application of criminal law to corporate behavior, others have referred to this litigation as "unprecedented" (Welty, 1982) and as a "landmark case" (Clinard, 1990; Frank & Lynch, 1992; Hills, 1987; Maakestad, 1987). Maakestad (1987, p. 7) stated that the case "[r]eestablished an important precedent: In certain cases involving human health and safety, corporations and their executives could be required to submit not only to the scrutiny and sanctions of traditional federal regulatory agencies, but to state criminal courts as well."
  77. ^ a b Dole, Charles E. (March 14, 1980). "Pinto verdict lets US industry off hook". The Christian Science Monitor. Retrieved March 3, 2016. An Indiana farm country jury in the 10-week landmark trial found Ford "not guilty" in the deaths of three teen-age girls whose 1973-model Pinto exploded when a speeding van struck it in the rear Aug. 10, 1978.
  78. ^ Schwartz 1991: In August 1978-half a year after the verdict in the tort case-a 1973 Pinto was involved in a fatal crash in Ulrich, Indiana. Indiana public officials decided to prosecute Ford for the crime of reckless homicide. Because the reckless homicide statute had been enacted only in 1977, Ford could not be prosecuted for the reckless design of the Pinto; rather, the prosecution needed to show a reckless post-1977 failure by Ford to repair or warn. Largely because of the narrowness of the resulting issue, at trial the prosecution was not able to secure the admission of internal Ford documents on which it had hoped to build its case. Ford's defense effort in this criminal case was vastly more ambitious than the effort the company had previously mounted in defending itself against Grimshaw's tort claim. In March 1980 the Indiana jury found Ford not guilty. The jury seemed ambivalent about the Pinto, but concluded that Ford had avoided recklessness in the conduct of its recall program.
  79. ^ Leviton, Joyce (February 4, 1980). "A Local D.A. Charges the Pinto with Murder—and Watergate's James Neal Comes to Its Defense". People. Vol. 13, no. 5. Retrieved March 3, 2016.
  80. ^ Gladwell 2015: A former head of the N.H.T.S.A. testified on Ford's behalf, stating that in his opinion the Pinto's design was no more or less safe than that of any other car in its class, like the Chevrolet Vega or the A.M.C. Gremlin.
  81. ^ Becker, Jipson & Bruce 2002
  82. ^ Sherefkin 2003: The low point for Ford came in 1979 when Indiana authorities charged the automaker with reckless homicide in a criminal trial.
  83. ^ Becker, Jipson & Bruce 2002: Two main perspectives emerged after the Pinto trial as to how the case outcome would affect future uses of criminal law against corporations for product liability issues. One viewpoint was stated by the then president of the National District Attorneys Association, Robert Johnson, Sr. He is quoted as saying "We'll see more prosecutions like this ... A psychological barrier has been broken, and the big corporations are now vulnerable" (Bodine, 1980, p. 3). The popular idea was that corporate malfeasance would be curtailed if corporations were held accountable for their actions. Thus, the feeling among some legal commentators was that the Pinto case represented a fundamental shift in how the criminal courts would perceive corporations. ... Another perspective was that the case was completely frivolous. Commenting on civil litigation, Harry Philo, then president-elect of the Association of American Trial Lawyers of America, commented that "In my opinion, the Pinto case was a completely irrelevant prosecution" (Stuart, 1980, p.4). However, he also stated that "[t]he verdict won't deter civil lawsuits" (Mleczko, 1980, llA).
  84. ^ Epstein 1980: The important point here is that neither the drama of the case nor its outcome should be allowed to obscure the essential legal and institutional issues. On the record, this criminal prosecution should never have been brought at all.
  85. ^ Becker, Jipson & Bruce 2002: The very fact that there has not been another product liability criminal prosecution since that case tells you one major impact of the case was ... [that] it said the criminal law is a very, very poor tool to use for product litigation. It's just not appropriate
  86. ^ Becker, Jipson & Bruce 2002: Paul Weaver worked for the Ford Motor Company from 1978 to 1980 in the corporation's public affairs staff preparing company positions on public policy issues. He criticized Ford for how it dealt with the controversy surrounding the Pinto. According to Weaver (1988, p.94), "[t]he design of its [Pinto's] fuel system was essentially the same as that of other cars of its size and generation" and "Pintos had about the same rate of death from fire due to rear-end collision as other small cars." His assertion is that the Pinto was not unusual compared to similar models. Weaver admits that "[w]e should simply have told the truth about the car" and "[w]e did not fight to vindicate ourselves." Thus, by refusing to mount a major publicity campaign, Ford gave the impression that it was guilty. ... These remarks add an interesting dimension to the Pinto case in that one of the clear lessons was to confront issues raised about defective products. This concern illustrates that after the Pinto case, corporations became much more willing and adept at handling images stemming from poor design. In other words, the Pinto case made corporations much more willing to wage public relations battles over design and production flaws.
  87. ^ a b Schwartz 1991 Footnote pg 1029
  88. ^ Schwartz 1991 pg 1031
  89. ^ Schwartz 1991 pg 1033
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