Category Archives: Product Liability

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Toyota’s Woes Continue

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Another week and the fallout continues to spread from Toyota’s recall controversy.

In Minnesota, a man imprisoned for vehicular homicide in a fatal Toyota crash sought a new trial, claiming that, in light of the unintended acceleration recalls, he was wrongly convicted for a mechanical malfunction that wasn’t his fault. A prisoner in Portland, Oregon has made similar claims in what is sure to be new trend in courts around the country.

Meanwhile, lawyers have begun to jockey for position in what is assumed to be a lucrative, and perhaps historic, class action lawsuit for all involved (J.P. Morgan recently put the total recall price tag for Toyota at $5.5 billion), internal company documents revealed that Toyota was aware of the unintended acceleration problem in 2002, when Camry owners began to complain about the issue.

The technical service bulletin went to every U.S. Toyota dealership in late August 2002 after some customers reported their vehicles were speeding up unexpectedly.

“Some 2002 model year Camry vehicles may exhibit a surging during light throttle input at speeds between 38-42 mph,” the bulletin states. “The Engine Control Module (ECM) calibration has been revised to correct this condition.”

Since the National Highway Traffic Safety Administration (NHTSA) was apparently aware of the issue as well, some critics, including Clarence Ditlow, the head of the nonprofit Center for Auto Safety, have suggested that both Toyota and the NHTSA are guilty of a coverup.

“The government is really hiding this information from the consumer,” Ditlow told CNN. “They’re in a conspiracy with the auto industry to keep these out of the public’s sight.”

Some analysts have questioned the seriousness of this document, however. Matt Hardigree of the automotive blog Jalopnik wrote that the CNN article may be misleading.

[The document] just shows there was a problem with electronics on one year of the Camry, which Toyota identified and repaired. The engine affected, the 1MZ-FE, isn’t even offered in the Camry anymore. The change to a new platform and new engine lineup would have drastically changed the ECM between the sixth-gen Camry and the current seventh-generation 2007-2010 Camry. Claiming the 2002 TSB [technical service bulletin] is related to Toyota’s current sudden unintended acceleration problems is sort of like claiming a screen recall on an iPhone is related to a recall on a first-generation iPod click-wheel.

While lawyers to try to figure what what Toyota knew and when, the recall problems continue to plague the automaker’s business and have been blamed for plant shutdowns in France and the UK. In February, Toyota’s sales in the European Union fell 20% as compared to the same time last year, despite the fact that overall auto sales in the EU were up 3%.

Finally (for now), Toyota was also forced to respond to owner complaints that recalled cars were still experiencing acceleration problems after they had been repaired by dealers. The company pledged to replace the pedals free of charge at the owner’s request. The operative phrase being “at the owner’s request”  as an internal memo cautioned dealers “not to solicit pedal replacement.”

As the crisis at Toyota rages on, stay tuned to the Monitor for the latest news and updates.

Toyota’s Troubles

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As Toyota prepares to announced yet another recall — this time, the Prius — some are beginning to question the car manufacturer’s business model.

The “Toyota Way” is the company’s long-standing philosophy that, among other things, places an extreme emphasis on maximizing efficiency by minimizing waste. Some have even said it acts almost like a religion amongst Toyota’s 316,000 employees. There is even a Toyota-approved way of turning corners when walking around the company’s numerous hallways (you must do say at a 90 degree angle). Think that’s bad? Toyota also demands that their employees never walk around the office with their hands in their pockets. A recent NPR news article quoted Tadao Wakatsuki, who worked at the auto giant for 45 years:

“If you walk around with your hands in your pockets, you’ll be told to take them out. If you drive to work, you file a report describing the route you take and the risks. If you drive to your hometown, you report exactly where you’re going to stop for a break. I would say there’s no freedom at Toyota.

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It’s totalitarian.”

Totalitarian to say the least. But was Toyota’s strictly-enforced mission to cut waste and drive efficiency taken too far, ultimately sacrificing quality and safety? In the wake of the recall of more than eight million cars, some think it was. The world’s number one car maker has taken a hit — not only in terms of revenue, but also in terms of reputation. Historically, car recalls have tainted the manufacturer’s image for years, sometimes forever, steering once-loyal car buyers towards other manufacturers. MSNBC lists the top 10 biggest vehicle recalls in history. The following are the top five:

Ford – Number of vehicles recalled: 7.9 million
Year of recall: 1996 The company warned that the ignition switch on the recalled vehicles could overheat and smoke or catch fire. Ford recalled most of its models built between 1988 and ’93, including the Aerostar, Bronco, Crown Victoria, Escort, F-150 pickup, Mustang, Tempo and Thunderbird.
General Motors – Number of vehicles recalled: 6.7 million
Year of recall: 1971
The engine mounts on these vehicles were found to potentially break, letting the engine move around, which could cause the mechanical linkage to jam the throttle. This affected a variety of Chevrolet models from 1965-’69, including the Chevrolet Bel Air, C-10 pickup, Camaro, Caprice, Chevy II, Impala and Nova. At the time GM used unique engines for each of its brands, so only the Chevrolets had the engine that used the affected mounts.
General Motors – Number of vehicles recalled: 5.8 million
Year of recall: 1981 A key bolt attaching the front suspension to the car could break, which would cause the suspension to collapse suddenly. This has obvious potential for negative outcomes, especially if the vehicle was being driven at the time it failed. The company recalled its mid-size cars built between 1978 and ’81 to replace the defective bolts. It included the Buick Century and Regal, Chevrolet Malibu and Monte Carlo, Oldsmobile Cutlass, and Pontiac Grand Prix and LeMans.
Toyota – Number of vehicles recalled: 5.4 million
Year of recall: 2009 Toyota estimated it recalled about 5.4 million vehicles in the U.S. over problems with vehicle floor mats, which they found could entrap the pedal causing unintended acceleration. The recall was initiated in 2009 and expanded in 2010.

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In 2010, Toyota recalled 2.3 million vehicles over problems with the gas pedal after the company found that an accelerator mechanism may not spring back up with enough pressure. About 2.1 million vehicles overlap in these two recalls, leading to a total recall so far of about 5.6 million vehicles for unintended acceleration. The final tallies won’t be known for a long while. The vehicles involved include Lexus-brand vehicles and the Toyota Camry, Tacoma and Tundra.

Ford – Number of vehicles recalled: 4.5 million
Year of recall: 2005 The automaker said the cruise-control mechanism on these vehicles could overheat and smoke or catch fire. The company recalled most of its full-size trucks, including the 1994-’96 Bronco, ’97-’02 Expedition, ’94-’02 F-150 and F-250, ’98-’02 Navigator and the short-lived 2002 Lincoln Blackwood pickup truck.

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  1. Ford –– Number of vehicles recalled: 7.9 million. Year of recall: 1996. The company warned that the ignition switch on the recalled vehicles could overheat and smoke or catch fire. Ford recalled most of its models built between 1988 and ’93, including the Aerostar, Bronco, Crown Victoria, Escort, F-150 pickup, Mustang, Tempo and Thunderbird.
  2. General Motors — Number of vehicles recalled: 6.7 million. Year of recall: 1971. The engine mounts on these vehicles were found to potentially break, letting the engine move around, which could cause the mechanical linkage to jam the throttle. This affected a variety of Chevrolet models from 1965-’69, including the Chevrolet Bel Air, C-10 pickup, Camaro, Caprice, Chevy II, Impala and Nova. At the time GM used unique engines for each of its brands, so only the Chevrolets had the engine that used the affected mounts.
  3. General Motors — Number of vehicles recalled: 5.8 million. Year of recall: 1981. A key bolt attaching the front suspension to the car could break, which would cause the suspension to collapse suddenly. This has obvious potential for negative outcomes, especially if the vehicle was being driven at the time it failed. The company recalled its mid-size cars built between 1978 and ’81 to replace the defective bolts. It included the Buick Century and Regal, Chevrolet Malibu and Monte Carlo, Oldsmobile Cutlass, and Pontiac Grand Prix and LeMans.
  4. Toyota — Number of vehicles recalled: 5.4 million. Year of recall: 2009. Toyota estimated it recalled about 5.4 million vehicles in the U.S. over problems with vehicle floor mats, which they found could entrap the pedal causing unintended acceleration. The recall was initiated in 2009 and expanded in 2010. In 2010, Toyota recalled 2.3 million vehicles over problems with the gas pedal after the company found that an accelerator mechanism may not spring back up with enough pressure. About 2.1 million vehicles overlap in these two recalls, leading to a total recall so far of about 5.6 million vehicles for unintended acceleration. The final tallies won’t be known for a long while. The vehicles involved include Lexus-brand vehicles and the Toyota Camry, Tacoma and Tundra.
  5. Ford — Number of vehicles recalled: 4.5 million. Year of recall: 2005. The automaker said the cruise-control mechanism on these vehicles could overheat and smoke or catch fire. The company recalled most of its full-size trucks, including the 1994-’96 Bronco, ’97-’02 Expedition, ’94-’02 F-150 and F-250, ’98-’02 Navigator and the short-lived 2002 Lincoln Blackwood pickup truck.

The Toyota recall may continue to climb in the ranks as the company continues to issue new recalls. As was the case with the other automakers on this list, it will take a lot of time to repair, not only their bottom line, but their image as well. For Toyota, time may or may not heal the financial and reputational wounds the company has suffered.

AKO on Product Recall Insurance

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Over at the Risk Management magazine website, Joshua Gold of Anderson, Kill & Olick discusses what policyholders need to know about product recall insurance in a special, online-only column.

In the context of product recall insurance coverage, some insurance companies may attempt to avoid coverage for a product recall losses by arguing that there is no evidence that the product in question did or would cause bodily injuries or damage. Specifically, the insurance company may argue that to trigger coverage, the use or consumption of the product must have resulted or would result in identifiable bodily injury, sickness, disease or death. Such insurance company arguments place the policyholder in an awkward position: namely, in an effort to establish coverage, the policyholder is being urged by the insurance company to evidence just how toxic its product was or could potentially be.

For important advice that will help you get your business back to normal in the event of a costly product recall, click here to read the full article exclusively on RMMagazine.com.

2009 – The Year of the Food Recall

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It has been an undeniably busy year when it comes to food recalls. From salmonella-contaminated peanut butter back in January that sickened thousands and killed nine to the more recent cat food recall issued by Diamond Pet Foods, the same company responsible for the tainted pet food that killed dozens of dogs around the nation in 2005, it seems there’s a new recall each week.

In fact, just yesterday more than 20,000 pounds of beef was recalled amid worries it is linked to at least two cases of salmonella. The beef was packaged by Beef Packers Inc., a Fresno-based company that is owned by Cargill, a company that has had it’s share of time in the spotlight for contaminated food. And last week, the FDA announced that oysters harvested from San Antonio Bay in Texas have caused about a dozen cases of norovirus-related illnesses.

To read the complete list of 2009 food recalls issued by the FDA is astonishing and terrifying. Let’s take a look at the month of November alone:

November 30, 2009 – La Espiga De Oro, Inc. Issues Allergy Alert on Undeclared Whey in Flour Tortillas
November 27, 2009 – Diamond Pet Foods Announces Recall of Premium Edge Adult Cat and Premium Edge Hairball Cat Food
November 25, 2009 – Vita Food Products, Inc. Issues an Alert Announcing Undeclared Wheat in ELF Branded Herring in Sour Cream
November 25, 2009 – Stryker Corporation’s Instruments Division Issues Worldwide Class 1 Recall of 23 Operating Room System II Surgical Navigation Systems; Catalog numbers 7700-100-000 and 7700-101-201
November 24, 2009 – Rikki USA, Inc.Re-Issues Allergy Alert on Undeclared Shrimp in Toi Sauce Thai Red Curry (Panang) produced for the Siamrica Co. to Correct Lot Number
November 22, 2009 – Timco Worldwide Inc. issuance of a voluntary recall of Large Seedless Watermelons because of possible health risk
November 20, 2009 – Five Crowns Marketing Voluntarily Recalling Cantaloupes Packed under the Majesty Label Because of a Potential Health Risk Due to Possible Contamination of Salmonella
November 20, 2009 – Unilever Issues Nationwide Allergy Alert on Undeclared Sulfites in Certain Shedd’s Country Crock® Chilled Side-Dish Products
November 19, 2009 – Service Smoked Fish Corp. Recalls Smoked Nova Salmon Because of Possible Health Risk
November 19, 2009 – Fresh & Easy Neighborhood Market Issues Allergy Alert on Undeclared Pecans in Mislabeled Fresh & Easy Pumpkin Cheesecake Pies
November 19, 2009 – P&G Voluntarily Recalls Specific Lots of Vicks Sinex Nasal Spray in the United States, Germany and the United Kingdom
November 18, 2009 – Nassau Candy Issues Nationwide Allergy Alert Because Of Possible Undeclared Allergens on their Tasty Dish Snack Tubs of Chocolate Almonds, Chocolate Raisins and Sour Neon Worms
November 17, 2009 – SNACKS ON RACKS, INC. Issues Nationwide Allergy Alert because of Undeclared Allergens in Their Gourmet Snacks Pack Product Line
November 17, 2009 – Cardiovascular Systems ViperSheath Sheath Introducer – Recall
November 17, 2009 – Superior Foods Co. Issues Allergy Alert On Undeclared Allergens in Fish Product
November 16, 2009 – Cardiovascular Systems Initiates Voluntary Recall of ViperSheathTM Sheath Introducer
November 13, 2009 – Cardiac Science Notifies AED Customers of Nationwide Voluntary Medical Device Correction
November 13, 2009 – Conagra Foods Issues Nationwide Allergy Alert on a Limited Number of 15 oz. Tubs of Blue Bonnet Light Spread
November 12, 2009 – Synthes USA, Ti Synex II Vertebral Body Replacement – Class I Recall
November 12, 2009 – IDS Sports Conducts a Voluntary Nationwide Recall of Bromodrol, Dual Action Grow Tabs, Grow Tabs, Mass Tabs, and Ripped Tabs TR
November 12, 2009 – GMP Herbal Products, Inc. Issues a Voluntary Nationwide Recall of a Weight Loss Supplement Found to Contain Undeclared Drug Ingredients
November 09, 2009 – Edwards Lifesciences CardioVations EndoClamp Aortic Catheter – Class 1 Recall
November 09, 2009 – RockHard Laboratories Issues a Voluntary Nationwide Recall of Specific Lots of RockHard Weekend marketed as Dietary Supplement
November 06, 2009 – Hospira Issues Nationwide Voluntary Recall of Certain Lots of Liposyn™ and Propofol Products That May Contain Particulate Matter
November 05, 2009 – FDA Health Alert for Certain Pet Treats Made by Pet Carousel
November 04, 2009 – Jelly Belly Issues Allergy Alert on Undeclared Peanuts in 7.5oz cylinder-style packages of 49 Flavors Jelly Belly jelly beans
November 04, 2009 – Centurion Medical Products – Premie Pack and Meconium Pack – Recall
November 04, 2009 – PetSmart Voluntarily Recalls Dentley’s Beef Hooves
November 03, 2009 – American Regent Expands Voluntary Recall to Include All Lots of Ketorolac Tromethamine Injection, USP 15 mg/mL; 1mL Single Dose Vial
November 03, 2009 – BODYBUILDING.COM Is Conducting a Voluntary Nationwide and International Recall of 65 Dietary Supplements That May Contain Steroids
November 03, 2009 – Pelican Bay Ltd. Issues Nationwide Allergy Alert on Undeclared Tree Nuts in Caramel Chocolate Truffle Hot Chocolate Mix
November 03, 2009 – Charleston Cookie Company Issues Allergy Alert on Undeclared Butter in Almond Cookies Produced for Dean & Deluca
  • November 30, 2009 – La Espiga De Oro, Inc. Issues Allergy Alert on Undeclared Whey in Flour Tortillas
  • November 27, 2009 – Diamond Pet Foods Announces Recall of Premium Edge Adult Cat and Premium Edge Hairball Cat Food
  • November 25, 2009 – Vita Food Products, Inc. Issues an Alert Announcing Undeclared Wheat in ELF Branded Herring in Sour Cream
  • November 25, 2009 – Stryker Corporation’s Instruments Division Issues Worldwide Class 1 Recall of 23 Operating Room System II Surgical Navigation Systems; Catalog numbers 7700-100-000 and 7700-101-201
  • November 24, 2009 – Rikki USA, Inc.Re-Issues Allergy Alert on Undeclared Shrimp in Toi Sauce Thai Red Curry (Panang) produced for the Siamrica Co. to Correct Lot Number
  • November 22, 2009 – Timco Worldwide Inc. issuance of a voluntary recall of Large Seedless Watermelons because of possible health risk
  • November 20, 2009 – Five Crowns Marketing Voluntarily Recalling Cantaloupes Packed under the Majesty Label Because of a Potential Health Risk Due to Possible Contamination of Salmonella
  • November 20, 2009 – Unilever Issues Nationwide Allergy Alert on Undeclared Sulfites in Certain Shedd’s Country Crock® Chilled Side-Dish Products
  • November 19, 2009 – Service Smoked Fish Corp. Recalls Smoked Nova Salmon Because of Possible Health Risk
  • November 19, 2009 – Fresh & Easy Neighborhood Market Issues Allergy Alert on Undeclared Pecans in Mislabeled Fresh & Easy Pumpkin Cheesecake Pies
  • November 19, 2009 – P&G Voluntarily Recalls Specific Lots of Vicks Sinex Nasal Spray in the United States, Germany and the United Kingdom
  • November 18, 2009 – Nassau Candy Issues Nationwide Allergy Alert Because Of Possible Undeclared Allergens on their Tasty Dish Snack Tubs of Chocolate Almonds, Chocolate Raisins and Sour Neon Worms
  • November 17, 2009 – SNACKS ON RACKS, INC. Issues Nationwide Allergy Alert because of Undeclared Allergens in Their Gourmet Snacks Pack Product Line
  • November 17, 2009 – Cardiovascular Systems ViperSheath Sheath Introducer – Recall
  • November 17, 2009 – Superior Foods Co. Issues Allergy Alert On Undeclared Allergens in Fish Product
  • November 16, 2009 – Cardiovascular Systems Initiates Voluntary Recall of ViperSheathTM Sheath Introducer
  • November 13, 2009 – Cardiac Science Notifies AED Customers of Nationwide Voluntary Medical Device Correction
  • November 13, 2009 – Conagra Foods Issues Nationwide Allergy Alert on a Limited Number of 15 oz. Tubs of Blue Bonnet Light Spread
  • November 12, 2009 – Synthes USA, Ti Synex II Vertebral Body Replacement – Class I Recall
  • November 12, 2009 – IDS Sports Conducts a Voluntary Nationwide Recall of Bromodrol, Dual Action Grow Tabs, Grow Tabs, Mass Tabs, and Ripped Tabs TR
  • November 12, 2009 – GMP Herbal Products, Inc. Issues a Voluntary Nationwide Recall of a Weight Loss Supplement Found to Contain Undeclared Drug Ingredients
  • November 09, 2009 – Edwards Lifesciences CardioVations EndoClamp Aortic Catheter – Class 1 Recall
  • November 09, 2009 – RockHard Laboratories Issues a Voluntary Nationwide Recall of Specific Lots of RockHard Weekend marketed as Dietary Supplement
  • November 06, 2009 – Hospira Issues Nationwide Voluntary Recall of Certain Lots of Liposyn™ and Propofol Products That May Contain Particulate Matter
  • November 05, 2009 – FDA Health Alert for Certain Pet Treats Made by Pet Carousel
  • November 04, 2009 – Jelly Belly Issues Allergy Alert on Undeclared Peanuts in 7.5oz cylinder-style packages of 49 Flavors Jelly Belly jelly beans
  • November 04, 2009 – Centurion Medical Products – Premie Pack and Meconium Pack – Recall
  • November 04, 2009 – PetSmart Voluntarily Recalls Dentley’s Beef Hooves
  • November 03, 2009 – American Regent Expands Voluntary Recall to Include All Lots of Ketorolac Tromethamine Injection, USP 15 mg/mL; 1mL Single Dose Vial
  • November 03, 2009 – BODYBUILDING.COM Is Conducting a Voluntary Nationwide and International Recall of 65 Dietary Supplements That May Contain Steroids
  • November 03, 2009 – Pelican Bay Ltd. Issues Nationwide Allergy Alert on Undeclared Tree Nuts in Caramel Chocolate Truffle Hot Chocolate Mix
  • November 03, 2009 – Charleston Cookie Company Issues Allergy Alert on Undeclared Butter in Almond Cookies Produced for Dean & Deluca

Amazing.

So this brings us to the topic of food safety regulation in the U.S., or lack thereof. In July, a bill was passed by the House that gave the FDA the power to order food recalls and require facilities to have a food safety plan. The bill will make its way to the Senate sometime next year, but it remains questionable that, if passed, the new law will actually have an effect on the current ways in which food is prepared, handled and packaged for sale.

From sour cream to jelly beans to beef and diet drinks, food recalls are increasing at an alarming rate and slow-moving regulations are not giving the consumers confidence in what makes it’s way to the dinner table or lunch box.