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Burden of Proof

Tire Recall: Lawsuits Building Against Ford and Bridgestone

Aired August 22, 2000 - 12:30 p.m. ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

GRETA VAN SUSTEREN, CO-HOST: Today on BURDEN OF PROOF: Six million tires are being recalled, leaving tread marks on the images of Ford and Bridgestone. As lawsuits pile up against the companies, transcontinental airlifts and assembly plant closings are showing up the needs for replacement tires in America.

(BEGIN VIDEO CLIP)

JACQUES NASSER, PRESIDENT AND CEO, FORD MOTOR COMPANY: You have my personal guarantee that all the resources of Ford Motor Company are directed to resolve this situation.

ALAN KLUGER, PLAINTIFFS' ATTORNEY: Right now, all they have is their word, which has not proven great, that they will comply.

JOHN LAMPE, EXEC. V.P., BRIDGESTONE/FIRESTONE: I have no reports of any preliminary findings. There are areas that we are jointly investigating and collecting additional data from.

(END VIDEO CLIP)

ANNOUNCER: This is BURDEN OF PROOF with Greta Van Susteren and Roger Cossack.

VAN SUSTEREN: Hello, and welcome to BURDEN OF PROOF.

Ford Motor Company and Bridgestone/Firestone are scrambling to provide new tires amid a massive recall. Ford, which builds the popular Explorer sport utility vehicle, is idling three truck plants for two weeks to free up replacement tires for SUVs already on the road.

ROGER COSSACK, CO-HOST: Meanwhile, Bridgestone/Firestone will begin shipping tires from Japan tomorrow, with as many as 10 planeloads to follow by Sunday. But lawsuits are building against the two companies.

VAN SUSTEREN: Joining us today from Cincinnati, Ohio, is Stanley Chesley, a plaintiffs' attorney in one of those class-action lawsuits. And in Atlanta, we're joined by an expert in tires, Dick Baumgardner.

COSSACK: And here in Washington, Rhett Bonnett (ph), civil defense attorney Brent Gurney and Kara Springer. And in the back, Jennifer Vona (ph) and Scott Johnson. Let's go right to Stan Chesley.

Stan, you're filing a class action. Who are you filing this class action against and why?

STANLEY CHESLEY, PLAINTIFFS' ATTORNEY: Well, we filed it in Ohio, simply stated, against both Ford and Bridgestone/Firestone for how they have, frankly, deceived the public and refused to have any uniform policy. They change their policy on a daily basis, depending on who sues them and why. It's very simple. There's no shortage of tires, and they need to give dignity to the consumer and treat them like they would want to be treated.

COSSACK: Stan, is your class-action lawsuit aimed at the way the recall is being conducted, or is it aimed at the tires which appear to be defective?

CHESLEY: It's a combination of both. One is an issue -- we want to get some discovery. I no longer want to believe Ford or Bridgestone/Firestone that it's -- they knew about this a year ago. We just had some folks in our office today who were brutally injured in a car that they'd bought six months ago, when in the meantime, Ford was replacing tires in Malaysia. I want citizens in Ohio to be treated as well or better than citizens in Malaysia. So the question is, what did they know and when did they know it?

And also, candidly, why should we believe that it's only these tires, when they're running the same tires, 16-inch tires, through the same plant with the same employees and the same equipment?

So we want to, A, get discovery, and B, I'd like a court to monitor their recall because I don't think you can trust these two companies. Ford now has a position, and Firestone, that you got to find a factory-owned -- a factory-owned -- Firestone station, company- owned, and you've got to put your money out. So we now have class distinction between those that can afford to pay the money. And then you got to drag your old carcass tires back to the dealer before you're going to get your rebate, and you got to send -- send out for your rebate.

It's very simple. They don't want to replace 6.25 million tires all in one year. They want the flow of money and the ability to hedge their bet by taking it over two or three years and using only Firestone tires instead of Goodyear or Michelin, because they'd have to pay. And candidly, recalls are great for industry because a lot of people -- if publicity dies down, most people won't adhere and go get the tires, and they'll save money.

COSSACK: Stan, one of the things that I find interesting about this case -- first of all, let me just tell you that I called the 800 number about the recall today. And frankly, I was stunned. I made two phone calls in less than 5 seconds. I was on hold less than 5 seconds both times, and they set forth how it would be, that if I wanted to have my tires exchanged, if I did have these tires. So at least they're responding quickly on the telephone. But let me ask you this, Stan. The whole idea of having knowledge that these -- that these tires may have been defective -- assuming that that can be proven in court, do you anticipate any state attorney generals going in and bringing civil actions or even criminal actions? I know you've done these cases in tobacco with state attorney generals. Do you anticipate that here?

CHESLEY: I think so. I think it's just starting to unfold because one of the issues is Ford is suggesting to people that they should inflate the tires a certain air pressure, and then Firestone says it's a different pressure. And the first statement out of Ford and Firestone was that it's the consumer's fault because they weren't properly inflating their tires. It's this finger-pointing virus. And I believe that attorney generals and I believe courts should monitor this recall program. And the other thing, this actual notice that Ford -- and Ford -- this is the...

VAN SUSTEREN: What is this notice that you claim they had? I mean, what's the evidence that you had that they knew that this was a problem?

CHESLEY: Why were they replacing voluntarily tires in Malaysia and Argentina 9 months to 12 months ago? When did the know, and what did they do about it? After all, this was one of their vendors, and they owed a duty to go down to that plant and inspect and find out what the problem was and stop using these tires.

We had a person in the office today who bought a car six months ago, a Mountaineer, which is a Ford Explorer with a Mercury badge on it -- bought a Mountaineer literally six months ago and had a rollover five -- rolled over five times. That car should not have been equipped with those tires during the same period of time they were replacing tires in Malaysia and Argentina. That's actual notice of which there's culpability and punitive conduct on the part of both of these folks.

COSSACK: All right, Brent, let me -- let me start to ask you questions. Obviously, you don't represent the people that we're talking about, Ford and Bridgestone/Firestone. But as a defense lawyer, someone who would defend in these situations, what do you start doing now?

BRENT GURNEY, CIVIL DEFENSE ATTORNEY: Well, in the beginning, I'd say to the company, "You've got two problems. You have a public relations problem, and then you have a legal problem." And the legal problem breaks down into two components. What do you do going backwards to defend those cases where you've already -- you already have incidents or you have lawsuits based on personal injury? And then what do you do going forwards to make sure that you cap your liability, that you don't have any more problems?

On the PR front, obviously, you've got to get out ahead on this issue. You don't want the facts to dribble out or you'll end up dying a death of a thousand cuts. And whatever your story is, you need to get it out. It needs to be accurate, and it needs to be out quick. COSSACK: What we've seen, as Stan points out, is almost, as I would say, sort of a changing position day to day. As Stan points out, you know, initially, they blamed consumers for not having the tires inflated to the proper per square inch. Now it's "We're going to recall the tires," and there's a problem, or at least an alleged problem, on how that happens. What would you be advising them?

GURNEY: Well, I'd -- initially, you need to get on top of the facts. You have to have some sort of comprehensive internal review, and then develop your -- your position based on the facts. Whatever the facts are, you've got to deal with those, but you need them out front at the beginning, and you do not want a changing story throughout.

VAN SUSTEREN: Brent, I'm always a little -- I mean, obviously, I'm a -- I was a defense attorney for years, so I always, you know, wonder if anyone's got any criminal liability. In the event -- and we don't know at this point, but hypothetically, if a corporation has knowledge that a product is defective but thinks they'll minimize damages by paying off civil lawsuits, is there a risk of criminal prosecution for anything like manslaughter if -- which is a reckless disregard? Is that something that you would worry about if you represented a corporation and it turns out they knew or should have known?

GURNEY: Well, it might be something that's in the back of my mind. I think it's rare to have criminal charges in product liability cases of this sort.

VAN SUSTEREN: But why? I mean, when there -- I mean, if it turns out...

CHESLEY: Ford Pinto...

VAN SUSTEREN: ... in any given case...

CHESLEY: ... they brought charges. I didn't mean to interrupt. They brought charges. They were found innocent, but they brought charges in Indiana. Jim Neal (ph) represented Ford on the Ford Pinto case.

VAN SUSTEREN: And they also brought charges against a man who owned a chicken factory down in North Carolina who locked the doors and there was a fire. He locked the doors so people couldn't steal chicken parts, and then there was a fire and the people couldn't get out. He's in prison. I mean, sometimes when you -- when you do things when you're a company, you run the risk of, you know, violating criminal law.

GURNEY: Well, it depends on the facts. And it wouldn't surprise me to hear that some prosecutor some place wanted to look into this. But if you have a -- if you basically have an issue of a company that put a product out there that turned out to be defective, and it's more or less a routine products liability case, even where death results, it's going to be rare that you're going to have a criminal prosecution. Now, if you have something egregious, if somebody destroyed documents, encouraged employees to lie obstructed justice somewhere along the line...

VAN SUSTEREN: What if you just turned your back? Just turned your back. You knew that the statistics were rolling up. And I don't know any -- I'm not suggesting I know any facts here, but you just turned your back and the statistics were just rolling up. Is that enough?

GURNEY: I -- well, is it enough? There's two questions. Is it enough? And would they bring a criminal case.

COSSACK: Right. And as you pointed out, those are rare occurrences.

I have to take a break. Up next: How tires are manufactured and what might have gone wrong in this case.

Stay with us.

(BEGIN LEGAL BRIEF)

In Flint, Michigan, today, 19-year-old Jamelle James reached a deal with prosecutors over charges of leaving out a .32-caliber handgun for a first-grade boy accused of killing a classmate.

James agreed to plead no contest to involuntary manslaughter in the death of 6-year-old Kayla Rolland.

(END LEGAL BRIEF)

(COMMERCIAL BREAK)

COSSACK: Lawsuits are building against Bridgestone/Firestone and Ford Motor Company. The claims stem from tires manufactured by Bridgestone which are commonly used on the Explorer, a popular Ford Sport Utility Vehicle.

Dick, what's wrong with these tires, if anything? What are the allegations? I think you have a tire with you. Perhaps you could point out some things for us.

DICK BAUMGARDNER, TIRE EXPERT: OK. What I would like to point out, first of all, is that the tread is coming off with the outer steel belt, and...

COSSACK: Perhaps we could get the camera to show -- to follow you and show us what -- there you are.

BAUMGARDNER: And what we have here is the outer steel belt, which is reinforced, and we have the rubber tread. And these are flexed a million times every 2,000 miles. In other words, as you're going down the road, the tire is being squeezed up and down on the highway. And as it's being squeezed up and down on the highway, the parts of the tire are being moved back and forth together. If the tire is properly assembled, these parts will simply remain in the rubber and continue to move. However, if we have a case where we have the tire and we have a slight separation developing between the...

VAN SUSTEREN: Can I just -- let me stop you. Dick, maybe you could sit down so we can see your hands a little bit easier as you're explaining this.

COSSACK: Yeah.

BAUMGARDNER: OK.

VAN SUSTEREN: All right.

BAUMGARDNER: But if we have the -- if we have the parts moving back and forth and we begin to develop a separation in there, that separation will tend to grow. And as it grows, it will begin to loosen the tread here. And this tread will start coming loose from the tire, but it will be restrained by the hoop of this steel belt. So there's no bulge. We don't see a bulge in the tire.

And as this is running down the highway, then, at high speed, this loose part, which has probably developed over several thousand miles, will suddenly break loose and cause the tread to come loose, beating on the vehicle and causing this -- the vehicle to go out of control...

VAN SUSTEREN: Dick...

BAUMGARDNER: ... and result in an accident.

VAN SUSTEREN: Dick, is this, in your view -- I know this is very early on in all this investigation, and the facts still aren't probably established. But is this a design defect, or is this a manufacturing defect? And what do you make of the reports that so many of these tires came out of the Decatur plant?

BAUMGARDNER: First of all, I believe this is a design defect because we are seeing it in many of these tires. And I've been able to see that this trend started in 1997, when we had about six of these tires in with identical failures. After that, then, as the situation progressed, we have seen more and more tires coming out with identical failures. When you see numerous tires coming with identical-type failures, you conclude that there's a design defect. There is a -- the tire is not being built properly.

VAN SUSTEREN: Is this tire so different, though, from another tire? I mean, are tires -- I mean, frankly -- and obviously, I'm going to really expose my ignorance. But I mean, I didn't know there was a tremendous difference in design of tires.

BAUMGARDNER: There is not a tremendous difference in the design of tires visually or by inspection by a person who is giving it a casual inspection. The real meat of the matter is how does that tire perform when it's being flexed down this highway millions of times as we're using it?

COSSACK: Dick, what about this conflict that allegedly exists between the tire pressure, where Ford perhaps suggesting that you keep the tire inflated to under 30 pounds -- maybe 26, 27 pounds -- but Bridgestone/Firestone suggesting that you keep it inflated between 30 and 35 pounds? Would that make a difference in how the tire wears and what we've seen today?

BAUMGARDNER: Yes. The tire flexes less. You have less movement of the parts as your pressure increases, and also the tire runs more coolly. It doesn't generate as much temperature and is less likely to, first of all, develop the separation, and then secondly, less likely to have that separation grow to the point at which the tire eventually will fail.

COSSACK: That's at a higher inflation. But at a lower inflation, would there be a smoother ride, for example, in an SUV?

BAUMGARDNER: Yes, there should be a smoother ride, and the vehicle should handle a little less responsively. Therefore, it would be less likely to tip over if sudden turning actions were taken.

VAN SUSTEREN: Stan, how come this is an Ohio state class action? Why not a national?

CHESLEY: Well, I wanted to start with Ohio because of the way they discriminated against Ohio residents. They said "Ohio, wait for a year." In other words, "You keep driving on these tires, even though they may kill you, but we'll get to you next year because we got a shortage of tires," when every tire store's advertising bargains on tires. So I decided, "Well, wait a minute." I live in Ohio. I represent Ohioans. And we're going to also so this in Kentucky and West Virginia. And frankly, you can take a state class action and make it into a national class action.

If Firestone and Ford were smart -- and I'm sure they're brilliant -- they would make this simple and they would want to go in front of a court and say to a court of competent jurisdiction, "We want to do this through a court and have a court put the whole thing together, similar to the way Chubb Insurance handled the drought insurance in 10 states when they didn't pay the insurance. They went in, and they made a class-action settlement, and did it through court independence. There is no independence here. There is not one person that's seen a document. There is no reason to believe that these are only 15-inch tire problems. If it's a design defect, it may very well -- I'd have to look to Dick because I think Dick is one of the nation's foremost experts -- look to Dick and ask him, "Well, why would there only be a 15-inch tire problem if there's a design defect? Why wouldn't this carry over to 16, just because it hasn't been discovered?"

The other thing that I...

VAN SUSTEREN: Let me -- let me just get you to hold that...

CHESLEY: Sure. VAN SUSTEREN: ... thought, Stan, because...

CHESLEY: Sure. I'm sorry.

VAN SUSTEREN: ... we have to -- we have to take a break.

CHESLEY: Sure.

VAN SUSTEREN: We'll be right back. Stay with us.

(BEGIN Q&A)

Q: Why is Dow Chemical Company planning to fire 40 employees near Houston, Texas?

A: They allegedly violated company e-mail policy by circulating violent or sexually explicit material.

(END Q&A)

(COMMERCIAL BREAK)

VAN SUSTEREN: Welcome back to BURDEN OF PROOF.

Brent, let me ask you a question. These tires that are sort of in question go back to 1991. If I were injured in 1991 as a result of a tire that I now believe should have been recalled by Firestone, and I was seriously injured, but more than three years has passed, and that's the -- and if that's the statute of limitations -- but I'm badly injured -- am I out of luck now, in terms of collection from Firestone or Ford?

GURNEY: I think if the statute of limitations has run, you're basically out of luck. There is, in many jurisdictions, a discovery rule that allows you to expand the statute of limitations if you only now discovered your injury and the defect that caused it.

COSSACK: Well, what if Ford knew before the statute of limitations ran and didn't do anything about it and therefore you would have known if they would have come forward with it?

GURNEY: That's probably not going to help you. I mean, in a situation where, back in '91, you suffer physical injury, that's probably going to be enough for a court to say that you, at that point, had a duty to investigate...

VAN SUSTEREN: But what...

GURNEY: ... and determine whether or not you had a claim.

VAN SUSTEREN: But -- but...

CHESLEY: I have a different...

VAN SUSTEREN: Go ahead, Stan. CHESLEY: I think if there's fraud -- fraud is an exception to the statute of limitations in most states. And if there is a fraud -- and I believe that you are looking fraud and gross misrepresentation -- I think that person would have a right to make a claim.

COSSACK: What would you...

VAN SUSTEREN: Is it enough to...

COSSACK: ... have to show for fraud?

VAN SUSTEREN: Let me -- let me just ask Stan...

COSSACK: I'm sorry. Go ahead.

VAN SUSTEREN: Is it enough if you have Ford saying inflate these to 26 and you have Bridgestone/Firestone say do it to 35, and they've had this battle going on, apparently -- I mean, I don't know this to be true, but this is what I'm reading. Is that enough...

CHESLEY: Sure. That's part of the...

VAN SUSTEREN: ... that the consumer doesn't know what...

CHESLEY: Sure, if that's part of the proximate cause of the injury, and it very, very well might be because the lower the pressure, the more wear and tear and the higher the heat build-up in the tire. I mean, this is a walking death trap. And candidly, this is a time bomb that isn't necessarily going to go off. I mean...

VAN SUSTEREN: Then is...

CHESLEY: Some people don't drive their cars that often. A person may have a car, an SUV, and may only have 10,000 miles on it...

COSSACK: Let me just ask Brent a question.

CHESLEY: ... since '91.

COSSACK: Brent, we've heard now the word "fraud" thrown out there, and lawyers know that if there's a fraud, the statute of limitations doesn't apply. Would it be enough if you could prove that Ford had actual knowledge in '91 that there was a problem with these tires and didn't do anything about it until now? Would that be a fraud?

GURNEY: No.

CHESLEY: If you can prove it.

GURNEY: No, that's not fraud. And assuming those facts are true...

COSSACK: Right.

GURNEY: ... even assuming those facts are true, that's not fraud. Fraud is when you make a misrepresentation to somebody, you lie to somebody...

COSSACK: Well, aren't you representing that these tires are safe? Isn't Fore representing, "Look, I know. I'm Mr. Ford. I know these tires aren't safe. I'm selling them to you and warranting that they are safe."

VAN SUSTEREN: And let me throw into the mix -- suppose that Ford begins getting wind that in other countries there's a bit of a problem and starts replacing tires in Malaysia and Argentina. Does that in any way -- are we getting to the point where they have a lot of knowledge and they have a duty to inform the consumer? Or not?

GURNEY: Well, there's two questions there. One, is it fraud? And two, did they have a duty to inform the consumer? I still don't think that's fraud. I know Stan will disagree with me. Do they have a duty to inform the consumer? Absolutely. There is a press report out there that, in fact, back in 1997, they were informed by insurance companies, or at least one insurance company, that there was a problem with the tires. The moment you receive notice, you have an obligation to begin taking corrective action.

VAN SUSTEREN: And if you do nothing? What happens?

GURNEY: If you do nothing and somebody suffers grievous injury, then you open yourselves up to punitive damages. You had notice that there was a problem, and you did nothing. Then you have real exposure.

COSSACK: You know...

GURNEY: And that's why...

COSSACK: Go ahead.

CHESLEY: But fraud can be an act of omission, particularly when you are sitting on all of the knowledge.

COSSACK: Stan, I got to interrupt everybody here and be rude, but because we're out of time.

Thanks for all of our guests today. Thank you for watching.

Today on CNN's "TALKBACK LIVE," Court TV's reality television. Are you ready for real criminal confessions? I know I'm ready for them. That's at 3:00 p.m. Eastern time, noon Pacific.

VAN SUSTEREN: I don't think I'm ready.

But tonight on CNN "NEWSSTAND": Do you feel vulnerable behind the wheel?

COSSACK: I do now.

VAN SUSTEREN: Our expert guests will be taking your e-mails and phone calls on this continuing story of the Bridgestone/Firestone recall and how to be safe on the road. That's at 10:00 p.m. Eastern time.

And we'll be back tomorrow with another edition of BURDEN OF PROOF. We'll see you then.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com

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