NHTSA Fines Takata $200 Million for Defective Airbags


In what is being characterized as the biggest civil penalty in the history of the National Highway Traffic Safety Administration (NHTSA), U.S. authorities are imposing a $200 million fine on a Japanese airbag manufacturer for the way it reportedly handled the defective airbag debacle.

Of that $200 million, $70 million is to be paid in cash by the manufacturer, Takata. The rest will be levied if the company fails to comply with the orders or if another issue is uncovered.

Feds also ordered the business to speed up recalls of its defective airbag inflators and step up its efforts out the use of ammonium nitrate propellant. That’s the chemical that’s believed to be behind the explosive airbag ruptures that have thus far been connected to more than 100 injuries and at least seven fatalities. The company also has to take efforts to remove the ammonium nitrate inflators that are currently installed in vehicles that are still on the road.

Anthony Foxx, U.S. Transportation Secretary, alleged that for years, this company manufactured and sold products that were defective. Not only that, the company refused to acknowledge the defect when they became aware of it and egregiously withheld information to the NHTSA, to its customers and the general public about the serious dangers. The end result of that, Foxx stated, was that “scores” of consumers were hurt. Further, the NHTSA was left to carry out the single largest and most complex safety recall in the agency’s history.

The fine is part of a consent order, in which the manufacturer has conceded that it violated the Motor Vehicle Safety Act when it failed to initiate a recall in a timely manner, even though it knew there was a dangerous defect. Further, it acknowledged that customers were given inaccurate, incomplete and selective safety data regarding Takata’s airbags going back to at least 2009.

Takata is one of the largest suppliers of airbags in the world, used by 12 major auto makers. The current recalls as they now stand involve 23 million inflators and 19 million vehicles. The risk to the public is astronomical.

That’s part of the reason the NHTSA has said it is also imposing “unprecedented” oversight of the company’s operations and imports through 2020. That will involve the appointment of an independent monitor who will analyze, track and report Takta’s compliance with the required recall process and phase-out schedule.

In a written statement, the CEO of the company expressed “deep regrets” about the circumstances leading to this fine, but hopes it can work diligently to rebuild trust with automakers and the public.

Automakers also have a requirement to act, which involves scheduling priority replacements based on the per-vehicle risk.

Apologies and fines may work to hopefully prevent such egregious violations of public safety and trust in the future, but it doesn’t prevent the harm that has already been caused to those who have been injured or families of those killed. Those individuals may still bring successful product liability lawsuits against Takata and potentially also the auto makers.

There may also be grounds for litigation by those who are injured as a result of the defective systems after the recall. Although initiation of a recall does not shield a company entirely from liability, it can reduce it significantly if there is evidence plaintiff should have known about it and taken action. Unfortunately for consumers in this situation, the problem is so massive that manufacturers in many instances simply don’t have the parts or the time to quickly repair the defects. It could take months or years. Some manufacturers have recommended drivers of certain vehicles not ride with a person in the front passenger seat until the problem can be fixed. It’s an unrealistic expectation.

Anyone injured as a result of these defective products should seek immediate legal counsel from an experienced personal injury attorney.

If you have been injured in an accident, contact the Hollander Law Firm at (561) 347-7770 for a free and confidential consultation. There is no fee unless we win.

Additional Resources:

U.S. Fines Takata Up to $200 Million Over Defective Airbags, Nov. 3, 2015, By Bill Chappell, NPR

More Blog Entries:

Baumann v. Zhukov – Trucking Accident Liability, Oct. 11, 2015, Florida Product Liability Attorney Blog