Petition for Writ of Certiorari — Wood v. General Motors Corp.

AQSEPH F. SPANIOL, JR.

70 CLERK

IN THE

Supreme Court of the United States

OCTOBER TERM, 1988

PATRICIA M. WOOD ., et al.,

Petitioners,

V.

GENERAL MOTORS CORPORATION,

Respondent.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FIRST CIRCUIT

Arthur H. Bryant

(Counsel of Record)

Trial Lawyers for Public Justice, P.C.

1625 Massachusetts Avenue, N.W.

Suite 100

Washington, D.C. 20036

(202) 797-8600

Alan B. Morrison

Public Citizen Litigation Group

2000 P St., N.W., Suite 700

Washington, D.C. 20036

(202) 785-3704

Edmund P. Daley

Moguin & Daley

388 Commonwealth Ave.

Boston, MA 02215

(617) 536-0606

Attorneys for Petitioners

Balmar Legal Publishing Division, Washington, D.C. 20005 1-800-888-8334

QUESTION PRESENTED!

Did the court of appeals err in ruling that Congress

intended state common law design defect damage claims to

be preempted by the National Traffic and Motor Vehicle

Safety Act of 1966 and federal standards covering the same

subject as the defect when Congress explicitly provided that

“{cjompliance with any [such] standard . . . does not exempt

any person from any liability under common law”?

Petitioners Patricia M. Wood, Francis X. Wood, and Elizabeth

Wood appeared as plaintiffs-appellees below. Respondent General

Motors Corporation appeared as defendant-appellant below. In addi-

tion, the Massachuswitts Public Interest Research Group; the Associa-

tion of Trial Lawyers of America; the Product Liability Advisory

Council, Inc.; the Automobile Importers of America, Inc.; and the Motor

Vehicle Manufacturers Association of the United States, Inc., appeared

as amici curiae in the court of appeals.

ili

TABLE OF CONTENTS

NN, ee

ed le Gl eles

a A a ee ere

Jurisdiction

Statutes and Regulations ... 2... 2... 0.04.

Statement

REASONS FOR GRANTING THE WRIT

1. The Decision Below Conflicts With the

Decisions of Other Circuits and State

a

2.. Whether Congress Intended State Common

Law Design Defect Damage Claims To Be

Preempted By The Safety Act and Standards

Covering the Same Subject as the Defect,

When Section 1397(c) Expressly Preserves

All Common Law Claims, Is an Important

che oa eh 6 6 pe 60 68 6 2

Conclusion

iV

13

20

Vv

TABLE OF AUTHORITIES

Cases:

Abbot v. American Cyanamid Co., 844 F.2d 1108 (4th

Oe ee ern ae a eae 18

Arbet v. Gussarson, 66 Wis. 2d 551, 225 N.W. 2d 431

CE ie hee Se) eee 9 Oe Oe 10, 12

Burch v. Amsterdam Corporation, 366 A.2d 1079 (App.

ee re ree Saree 18

California Federal Savings and Loan Association v.

Guerra, 479 U.S. 272 (1988) ........... 16

Dawson v. Chrysler Corporation, 630 F.2d 950 (3rd Cir.

1980), cert. denied, 450 U.S. 959 (1981) ..... 10, 11, 15

Dorsey v. Honda Motor Company Ltd., 655 F.2d 650

(Sth Cir. 1981), cert. denied, 459 U.S. 880

SE Goad ee ee eee ee 8 10, 12

Ferebee v. Chevron Chemical Company, 736 F.2d 1529

(D.C. Cir. 1984), cert. denied, 469 U.S. 1062 j

ENR Ana uia aw ih aCh al aele Wee eee 18

Fidelity Federal Savings and Loan Association v. de la

Cosmin, S56 US. 141 (19GZ) 0 we ees 12

Fox v. Ford Motor Company, 575 F.2d 774 (10th Cir.

a FEROS OR KTR PNR Les 10, 12, 16

General Motors Corporation v. Edwards, 482 So.2d

SRE oe 4 sd eee Oo ee eS 10, 11

Goodyear Atomic Corporation v. Miller, 486 U.S. 174,

ee ee ee 18

vi

H. P. Hood & Sons, Inc. v. Ford Motor Company, 370

Mass. 69, 345 N.E. 2d 683 (1976) ......... 10

Hubbard-Hall Chemical Company v. Silverman, 340

ee es 8 eee Se eee 18

Kitts v. General Motors Corporation, No. 87-2517 (10th

oR 3. . er re re 12

Knippen v. Ford Motor Company, 546 F.2d 993 (D.C.

oe. Perret e er rT or ero ee 10, 11

Larsen v. General Motors Corporation, 391 F.2d 495

eee 10

McIntire v. Estate of Forte, 463 S.W. 2d 491 (Tex. Civ.

App. 1971)... cece cee vevecees 18

. Raymond v. Riegal Textile Corporation, 484 F.2d 1025

(ist Gl. Base 6 ove ee tee ewe eee 18

Ritt v. General Motors Corporation, No. 88-1822 (7th

6h a ee ES 7,12

Schwartz v. American Honda Motor Co., Inc., 710 F.2d

S7B CHA. SOD hs 0-¥ vs Fee eee Os 16

Shipp v. General Motors Corporation, 750 F.2d 418 (Sth

Ce. TOR o's ea OE eee 10, 12

Silkwoed v. Kerr-McGee, 464 U.S. 238 (1984) ..... 5, 16, 18

Sours v. General Motors Corporation, 717 F.2d 1511

oe | ere ee re ee ere 10, 12

Stonehocker v. General Motors Corporation, 587 F.2d

251 CG ee a ere sk eee ee 10

Taylor v. General Motors Corporation, No. 87-5829

(1ith Cie, Fone 34, Tee) sc ee eeners 12

Vil

Volkswagen of America, Inc. v. Young, 272 Md. 201, 321

pe ye FB)

Will v. Michigan Department of State Police, 57

U.S.L.W. 4677 (June 13, 1989) ..........

Statutes:

UP 6 5 0 0 6 60 wee eee sen ws

15 U.S.C. §§ 1381 et seq., P.L. 89-563, 80 Stat. 718 ..

ee ee eee aa ee ear

pe ee ee eee er

6 | Ra eee a eee

I a ales s 6 <5 a ooo oo ee ee

Legislative History:

H.R. Rep. No. 1776, 89th Cong., 2d Sess. (1966) .. .

S. Rep. No. 505, 89th Cong. 2d Sess. (1983) .....

Hearings before the Subcommittee on Executive

Reorganization on the Federal Role in Traffic

Safety, 89th Cong., 2d Sess., Part IV, (1966)

Regulations:

o,f a are

Miscellaneous:

R. Nader, Unsafe at Any Speed (1965) .........

10, 12

14

8, 13

Vili

No. 88-

IN THE

Supreme Court of the United States

OCTOBER TERM, 1988

PATRICIA M. WOOD , et al.,

‘ Petitioners,

V.

GENERAL MOTORS CORPORATION,

Respondent.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FIRST CIRCUIT

OPINIONS BELOW

The opinion of the district court is reported at 673 F.

Supp. 1108 (D.Mass. 1987) and appears in the separately

bound appendix being filed with this petition at Pet. App.

71a-101a. The majority and dissenting opinions of the court

of appeals are reported at 865 F.2d 395 (1st Cir. 1988) and

appear at Pet. App. 1a - 70a. The unpublished orders of the

court of appeals denying reconsideration and rehearing en

banc appear at Pet. App. 104a -105a. The unpublished order

of the court of appeals denying revocation of the mandate

and reconsideration and rehearing en banc appears at Pet.

App. 106a.

JURISDICTION

The judgment of the court of appeals was issued on

December 28, 1988. Pet. App. 103a. The order denying

2

rehearing en banc was entered on February 7, 1989. Pet.

App. 105a. On April 26, 1989, Justice Brennan issued an

order extending the time for filing a petition for a writ of

certiorari until July 7, 1989. This Court has jurisdiction

pursuant to 28 U.S.C. § 1254(1).

STATUTES AND REGULATIONS

The National Traffic and Motor Vehicle Safety Act of

1966, 15 U.S.C. §§ 1381 et seq., P.L. 89-563, 80 Stat. 718

("Safety Act") provides in pertinent part as follows:

§ 1392(d) Whenever a Federal motor vehicle

safety standard established under this subchapter

is in effect, no State or political subdivision of a

State shall have any authority either to establish, or

to continue in effect, with respect to any motor

vehicle or item of motor vehicle equipment any

safety standard applicable to the same aspect of

performance of such vehicle or item of equipment

which is not identical to the Federal standard.

Nothing in this section shall be construed to

prevent the Federal Government or the govern-

ment of any State or political subdivision thereof

from establishing a safety requirement applicable

to motor vehicles or motor vehicle equipment

procured for its own use if such requirement im-

poses a higher standard of performance than that

required to comply with the otherwise applicable

Federal standard.

** *& &

§ 1397(c) Compliance with any Federal motor

vehicle safety standard issued under this subchap-

ter does not exempt any person from any liability

under common law.

EE ——————— ee ——— — a

3

Relevant excerpts from Federal Motor Vehicle Safety

Standard 208, 49 C.F.R. § 571.208, appear at Pet. App. 107a

- 110a. The 1976 GM Blazer at issue in this case is a “multi-

purpose passenger vehicle with GVWR [gross vehicle weight

rating] of 10,000 pounds or less manufactured on or after

January 1, 1976.” 49 C.F.R. § 571.208 S4.2.2.

STATEMENT

This is a diversity action filed pursuant to 28 U.S.C. §

1332, seeking damages under Massachusetts law for severe

personal injuries suffered in a car crash. On May 19, 1981,

petitioner Patricia Wood was riding home from school as a

passenger in the front seat of a 1976 General Motors Blazer.

The car crashed, Patricia was thrown forward, her neck was

broken, and she was rendered a quadriplegic.

In May 1984, Patricia and her parents filed this lawsuit

in the United States District Court for the District of Mas-

sachusetts seeking damages from respondent General

Motors, the manufacturer of the Blazer in which she was

riding. They alleged that the Blazer was defectively designed

because it did not contain some form of passive restraints,

ie., airbags or automatic seatbelts (seatbelts that do not

require the individual to “buckle up” to be effective). They

further alleged that, if the Blazer had been properly

designed, Patricia would not have been injured.

General Motors moved for summary judgment in the

district court on two grounds. First, it argued that plaintiffs

had failed to state valid claims under Massachusetts law.

Second, it argued that, if Massachusetts law did recognize

plaintiffs’ claims, then that law was preempted by the Safety

Act. GM noted that, in designing the 1976 Blazer, it had fully

complied with Federal Motor Vehicle Safety Standard 208,

49 C.F.R. § 571.208, which permitted, but did not require, it

4

to install passive restraints. It contended that plaintiffs’

claims, if successful, would force it to install airbags in all cars

and were, therefore, expressly preempted by 15 U.S.C.

§ 1392(d), which prohibits any State from establishing “any

safety standard” applicable to the “same aspect of perfor-

mance” as a Federal standard “which is not identical to the

Federal standard.” GM also argued that plaintiffs’ claims

were impliedly preempted because, if successful, they would

make compliance with both federal and Massachusetts law

a physical impossibility.and would frustrate the purposes of

the Safety Act and Standard 208.

On May 8, 1987, the district court denied GM’s motion.

First, it held that, if plaintiffs were able to prove theirclaims, __

they were entitled to recover damages from GM under

Massachusetts law. That ruling was not before the court of

appeals and is not before this Court. Second, it ruled that

the Safety Act neither expressly nor impliedly preempts

plaintiffs’ claims. It rejected GM’s express preemption ar-

gument on the grounds that (1) Congress knows how to

explicitly preempt common law claims when it wants to do

SO; (2) section 1392(d) does not expressly refer to common

law claims, but, rather to state “safety standards”; and (3)

section 1397(c) does refer to common law claims and une-

quivocally provides that “[c]ompliance with any Federal

_motor vehicle safety standard issued under this subchapter

does not exempt any person from any liability under com-

mon law.” 673 F. Supp. at 1113-14, Pet. App. 80a - 82a. It

rejected GM’s “physical impossibility” argument on the

ground that GM could physically comply with both federal

and Massachusetts law by continuing its design and paying

damages to injury victims. 673 F. Supp. at 1114-16, Pet. App.

82a - 85a.* It rejected GM’s “frustration of purpose” argu-

*GM could, of course, also physically comply with both federal and

Massachusetts law by installing passive restraints.

5

ment on the grounds that (1) it saw no conflict between

plaintiffs’ claims and the purposes of the Safety Act or

Standard 208 and (2) to the extent that any such conflict

exists, it is one that Congress intended to accept by enacting

section 1397(c). 673 F. Supp. at 1116-19, Pet. App. 86a -93a.

It noted that both the presumption against preemption and

this Court’s ruling in Silkwood v. Kerr-McGee, 464 U.S. 238

(1984), weighed heavily against a finding that Congress,

without saying so clearly, intended to preempt Mas-

sachusetts common law and leave plaintiffs without any

remedy. Id.

GM moved to certify the decision for interlocutory

appeal. The United States Court of Appeals for the First

the following

question for appeal: “Whether federal law preempts a state

product liability claim against a motor vehicle manufacturer

based on its installing seat belts, rather than airbags, in a

motor vehicle.” 865 F. 2d at 397, Pet. App. 3a - 4a.°

On December 28, 1988, the court of appeals issued its

decision, holding 2 to 1 that plaintiffs’ claims were impliedly

preempted. In an opinion written by Chief Judge Campbell

and joined by District Judge Laffitte, sitting by designation,

the majority agreed with the district court that section

1392(d) did not expressly preempt common law claims, but

accepted GM’s contention that plaintiffs’ claims, if success-

ful, would force the auto manufacturers to install airbags in

all cars. It conceded that section 1397(c), as written,

preserved all common law claims, including plaintiffs’, but

could see no reason why Congress would have wanted to

3 Plaintiffs objected below to this formulation of the question because

they do not claim that GM was negligent for installing seatbelts rather

than airbags; they claim that GM should have installed either airbags

and seatbelts or some other form of passive restraints, such as automatic

seatbelts. The court of appeals’ ruling, however, did not turn on this

distinction.

6

preserve common law claims that, in its view, would have the

same effect as a state regulatory standard that would be

preempted by section 1392(d). It, therefore, concluded that

Congress must have written 1397(c) and 1392(d) as it did

because, in 1966, “the only kind of legal claim which could

give rise to the present dilemma — a cause of action based

upon alleged automobile design defects — had yet to take

its place in the arsenal of the plaintiffs’ bar.” 865 F.2d at 402,

Pet. App. 15a Congress, the majority said:

did not foresee the possibility of litigation that

could, in effect, impose a new and conflicting state

safety standard on national automobile manufac-

turers. Had Congress done so, we think, the same

logic that dictated the insertion of section 1392(d)

would have inescapedly dictated that section

1392(d) extend to this situation.

865 F. 2d at 402, Pet. App. 15a. Based on these assumptions,

the majority held that the Safety Act impliedly preempts

plaintiffs’ claims and all other common law design defect

claims that would have “an effect similar to a state regula-

tion” that would be preempted by section 1392(d). 865 F. 2d

at 410, Pet. App. 32a.

Judge Selya’s dissent accused the majority of ignoring

the plain and unequivocal language of section 1397(c) and

found that plaintiffs’ claims were neither expressly or im-

pliedly preempted. It asserted that Congress was aware of

design defect litigation in 1966 and that, in any event, Con-

gress was certainly aware that the common law continually

developed and evolved. 865 F. 2d at 421, 423; Pet. App. 57a

- 58a, 60a - 62a. It observed that the majority’s interpretation

of the Safety Act conflicted with the interpretations adopted

by other circuits, 865 F. 2d at 422, 426; Pet. App. 59a - 60a,

68a - 69a, and disputed the majority’s contention that

plaintiffs’ claims, if successful, would necessarily prompt all

7

manufacturers to install passive restraints. 865 F. 2d at 426;

Pet. App. 68a. It argued that the majority was ignoring the

sharp distinction that Congress drew between direct state

regulation (which Congress preempted) and the indirect

regulatory effect of common law claims (which Congress

expressly preserved). It asserted that Congress’s distinction

was a reasonable one and that, even if the majority disagreed

with it, it was duty bound to accept it. 865 F. 2d at 423-426,

Pet. App. 62a - 70a.

Plaintiffs moved for reconsideration and rehearing en

banc, but, on February 7, 1989, these motions were denied.

Pet. App. 104a, 105a. After the mandate was issued, plain-

tiffs filed a motion asking the court to withdraw the mandate

and reconsider its decision in light of the position taken by

the United States of America in an amicus curiae brief filed

before the United States Court of Appeals for the Seventh

Circuit in Ritt v. General Motors Corporation, No. 88-1822, a

case involving nearly identical issues. In that case, in which

the court itself asked for the views of the United States and

which GM has since settled, the United States argued that

the majority’s decision below in this case was erroneous:

That the common law is by its nature a developing

body of law is one of the chief reasons we reject the

alternate means of harmonizing §§ 1392(d) and

1397(c) recently adopted by the First Circuit in

Wood v. General Motors Corp., 865 F.2d 395 (ist

Cir. 1988). The Wood court held that while §

1397(c) is applicable to tort actions based on

manufacturing defects, it should not be applied to

authorize actions based on design defects, on the

theory that Congress would not have foreseen the

development of such actions against automobile

manufacturers. See 865 F.2d at 403-06. This

analysis is erroneous because it ignores the fact

8

(well-known to Congress) that the common law is

evolutionary, and that design defect litigation was

in fact already developing by the mid-1960s. See id.

at 421-23 (Selya, J., dissenting).

Brief of the United States as Amicus Curiae, at 23 n.13

(enfphasis in original).4 On May 25, 1989, the court of

appeals denied plaintiffs’ motion. Pet. App. 106a.

REASONS FOR GRANTING THE WRIT

Twenty-four years ago, the publication of Ralph

Nader’s Unsafe at Any Speed (1965) helped spur two major

developments in the law. First, it prompted personal injury

lawyers and the courts to give increased attention and recog-

nition to a relatively recent development — automobile

design defect litigation on behalf of injured drivers and

passengers. Second, it prompted Congress to give increased

attention to the need for federal auto safety legislation and,

ultimately, to pass the National Traffic and Motor Vehicle

Safety Act of 1966, 15 U.S.C. §§ 1381 et seq.

In the intervening years, as automobile design defect

litigation has grown, the auto manufacturers have consistent-

ly argued that, when they have complied with an applicable

Federal motor vehicle safety standard, they cannot be held

liable for failing to do more. Equally consistently, the courts

have rejected this argument. For the past twenty-four years,

they have said: Congress expressly provided in 15 U.S.C.

§ 1397(c) that compliance “does not exempt any person

from any liability under common law.” (Emphasis added.)

In this case, however, the First Circuit has concluded

that Congress must not have known of design defect litiga-

4 For the Court’s convenience, a copy of this brief has been lodged

with the Clerk. It has been previously served upon all parties.

9

tion in 1966 and that section 1397(c) must not mean what it

says. Because it saw no reason why Congress would have

wanted to preserve common law claims that would have a

regulatory effect, it held that all common law claims that

would have an effect similar to a preempted state regulation

are impliedly preempted. Since, in its view, plaintiffs’ claims

would have such an effect, the majority ruled that Mas-

sachusetts does not have the power to require GM to com-

pensate the plaintiffs for their injuries. This Court should

grant certiorari and overturn that ruling for two reasons.

First, the court of appeals’ decision conflicts with the

decisions of several other federal circuits and state courts of

last resort. In numerous design defect cases, these courts

have held that compliance with federal standards has no

determinative or preemptive effect on state tort liability,

even when tort liability might prompt the manufacturers to

do more than the federal standards require.

Second, whether Congress intended the Safety Act to

preserve all State common law claims, regardless of their

regulatory effect, is an extremely important federal question.

The decision below seriously misstates the development of

design defect litigation and Congress’s knowledge of it,

directly contradicts Congress’s plain words and the presump-

tion against preemption, and turns the implied preemption

doctrine into a dangerous and open invitation for judicial

disruption of federal-state relations.

1. The Decisicn Below Conflicts With the

Decisions of Other Circuits and State

Courts of Last Resort.

Prior to the decision below, eight federal circuit courts

and five state courts of last resort had addressed the issue of

whether compliance with federal motor vehicle safety stand-

ards exempts auto manufacturers from liability in design

10

defect cases. Some phrased the question as whether com-

pliance with federal standards constituted a defense; others

asked whether compliance resulted in federal preemption.

Each, however, reached the same conclusion: the Safety Act

was not intended to preclude common law claims. ==

Thus, in the first such case to reach a federal court of

appeals, Larsen v. General Motors Corporation, 391 F.2d 495,

506 (8th Cir. 1968) the Eighth Circuit stated:

Section 108(c) of the Act, 15 U.S.C. § 1397(c),

expressly negatives any intention of Congress to

acquire exclusive jurisdiction in this field and

leaves the common law liability intact . . . It is

apparent that the National Traffic Safety Act is

intended to be supplementary of and in addition to

the common law of negligence and product

liability.

Accord Knippen v. Ford Motor Company, 546 F.2d 993, 1000

(D.C. Cir. 1976); Dawson v. Chrysler Corporation, 630 F.2d

950, 957-58 (3rd Cir. 1980), cert denied, 450 U.S. 959 (1981);

Stonehocker v. General Motors Corporation, 587 F.2d 151,

156-57 (4th Cir. 1978); Dorsey v. Honda Motor Company Ltd.,

655 F.2d 650, 656-57 (Sth Cir. 1981), cert. denied, 459 U.S.

880 (1982); Shipp v. General Motors Corporation, 750 F.2d

418, 421 (Sth Cir. 1985); Sours v. General Motors Corporation,

717 F.2d 1511, 1516-17 (6th Cir. 1983); Schwartz v. American

Honda Motor Co., Inc., 710 F.2d 378, 383 (7th Cir. 1983); Fox

v. Ford Motor Company, 575 F.2d 774, 778 (10th Cir. 1978);

General Motors Corporation v. Edwards, 482 So.2d 1176, 1198

(Ala. 1985); Volkswagen of America, Inc. v. Young, 272 Md.

201, 321 A.2d 737, 746 (Md. App. 1974); H. P. Hood & Sons,

Inc. v. Ford Motor Company, 370 Mass. 69, 345 N.E. 2d 683,

688 (1976); Arbet v. Gussarson, 66 Wis. 2d 551, 225 N.W. 2d

431, 438 (1975).'

11

In several of these cases, the plaintiffs’ claims, if success-

ful, might arguably have prompted the manufacturers to

alter their conduct on a nationwide basis. The courts were

aware of this fact, and sometimes questioned Congress’s

judgment, but nevertheless concluded that Congress had,

indeed, intended to preserve such common law claims. For

example, in Dawson, supra, 630 F.2d at 962-63, the jury found

that a side door design provided inadequate crash protection

despite the fact that it complied with Standard 214. The

Third Circuit stated:

The effect of [15 U.S.C. § 1397(c)] is that the states

are free, not only to create various standards of

liability for automobile manufacturers with respect

to design and structure, but also to delegate to the

triers of fact in civil cases arising out of automobile

accidents the power to determine whether a par-

ticular product conforms to such standards ... In

effect, this permits individual juries applying vary-

ing laws in different jurisdictions to set nationwide

automobile safety standards ... Inasmuch as it was

the Congress that designed the system, and be-

cause Congress is the body best suited to evaluate

and, if appropriate, to change the system, we

decline today to do anything in this regard except

to bring the problem to the attention of the legis-

lative branch.

Similarly, in General Motors Corporation v. Edwards,

supra, 482 So.2d at 1180, the jury found that the placement

of the gas tank in the “crush zone” between the rear bumper

and axle was negligent, despite its compliance with Standard

301. Affirming the verdict, the Supreme Court of Alabama

noted that the jury’s decision had “potential national im-

plications,” but, fully in keeping with Congress’s intent,

“refuse[d] to ... hold” that the standards set by the federal

ii iii iid

12

government were “conclusive”. See also, Knippen, supra

(turning signal and parking light design complying with

Standard 108 found defective); Dorsey, supra (numerous

design aspects complying with federal standards found insuf-

ficiently crashworthy); Shipp, supra (roof design complying

with Standard 216 found insufficiently crush-resistant); |

Sours, supra (same as Shipp); Fox, supra (rear passenger

restraint system found defective because it lacked rear

shoulder harnesses, which Standard 209 did not require);

Volkswagen, supra (fuel tank design complying with Standard

301 found insufficiently crush-resistant); Arbet, supra (same |

as Volkswagen).

Since the decision below, two federal circuits have ad-

dressed similar issues, both in the context of cases involving

passive restraints. In Kitts v. General Motors Corporation,

No. 87-2517 (10th Cir. May 19, 1989), the Tenth Circuit

simply adopted the approach of the court of appeals in this

case, without explaining how this result comported with its

1976 affirmance of the verdict in Fox v. Ford Motor Company,

supra, the rear shoulder harness case. And, in Taylor v.

General Motors Corporation, No. 87-5829 (11th Cir. June 14,

1989), the Eleventh Circuit explicitly rejected the court of

appeals’ reasoning in this case, but, relying on this Court’s

ruling in Fidelity Federal Savings and Loan Association v. de

la Cuesta, 458 U.S. 141 (1982), held that Florida common |:

design defect claims involving the failure to install airbags

are impliedly preempted, even though GM could have com-

plied with both federal and Florida law by installing passive

restraints, because a ruling favorable to the plaintiffs would

“frustrate the federal regulatory scheme.” Taylor, supra, slip

op. at 2982. Then, on June 21, 1989, three months after the

United States submitted an amicus brief specifically dis-

agreeing with the First Circuit’s rationale in this case,

General Motors made a substantial cash payment to settle

|

’

’

13

Ritt v. General Motors, supra, the Seventh Circuit case which

was awaiting decision.

As a result of these various rulings, there is now a stark

conflict between the majority below and other federal cir-

cuits and state courts of last resort over whether Congress

intended to preempt any design defect cases that might have

a regulatory effect. Even for those courts finding preemp-

tion, there is a sharp disagreement over the theory under

which section 1397(c) is, in effect, nullified. There are cur-

rently thousands of automobile design defect cases pending

throughout the country, over a hundred of which involve

claims concerning passive restraints. The preemption issue

has been raised or is lurking in every one of them and,

therefore, this Court should grant review to resolve the

conflict.

2. Whether Congress Intended State Common Law

Design Defect Damage Claims To Be Preempted

By The Safety Act and Standards Covering the

Same Subject as the Defect ,When Section 1397(c)

Expressly Preserves All Common Law Claims, is

an Important Federal Question.

The majority below decided to disregard the plain and

unequivocal words of section 1397(c) because it believed

that Congress had not anticipated the development of

automobile design defect litigation when it enacted those

words into law. That ruling is incorrect both because it

contains a mistaken assumption about the state of design

defect litigation when the Safety Act was passed and because

it impermissibly thrusts the federal courts into a policy-

making role of deciding whether to displace state law when

Congress has spoken plainly on the subject.

The Safety Act arose, in part, from the huge public

clamor created by Ralph Nader’s 1965 publication of Unsafe

taal

14

at Any Speed and General Motors’ decision to hire a private

investigator to conduct surveillance of Mr. Nader. During

exhaustive Congressional hearings on the Federal Role in

Traffic Safety, held in late 1965 and early 1966, GM’s Presi-

dent admitted that it hired this investigator because it was

concerned about Mr. Nader’s potential involvement in

—_——design defectlitigation concerning the Corvair. He testified: |

As of November 1 of last year [1965], General

Motors Corporation was a defendant in over 100

lawsuits involving potentially about $40 million in

damage claims relating to the design of Corvair cars

of the 1960 through 1963 model years.

Hearings before the Subcommittee on Executive Reorganiza-

tion on the Federal Role in Traffic Safety, 89th Cong., 2d Sess.,

Part IV, 1382 (1966) (emphasis added).

Congress heard extensive testimony on GM’s response

to civil actions alleging design defects, as well as case reviews

of anumber of those actions. Jd. at 1382-1591. Congress was

also informed of the national publicity being given to deaths

and injuries caused by automobile design defects, as well as |

the thousands of lawsuits anticipated:

— en een er

“It is impossible to predict how many injuries and

deaths have resulted from the instability of the

Corvair automobile,” [plaintiffs’ trial lawyer Harry]

Philo said, “but my guess is that it would reach five

figures.” He said that 1,000 suits were brought

against automobile manufacturers last year and

the number would increase to 5,000 next year.

Id. at 1410-11 (quoting The Miami Herald, July 19, 1965).

With this knowledge, Congress nevertheless worded

section 1397(c) to preserve all common law claims, regard-

less of their regulatory effect. In case the plain language of

15

the provision left any questions, the House Report to the

Safety Act explained:

It is intended, and this subsection specifically es-

tablishes, that compliance with safety standards is

not a defense or otherwise to affect the rights of

parties under common law particularly those relat-

ing to warranty, contract, and tort liability.

H.R. Rep. No. 1776, 89th Cong., 2d Sess. 24 (1966) (em-

phasis added).

Moreover, even if Congress had not known of design

defect litigation in 1966, the majority below seriously erred

in finding implied preemption on the ground that, if Con-

gress had known, it would have extended section 1392(d) to

preempt some design defect claims because of their

regulatory effect. 865 F.2d 402, Pet. App. 15a. To begin

with, Congress surely was aware in 1966 that the common

law was continually evolving and expressed no intention

whatsoever to limit whatever evolution might take place. In

addition, the Safety Act has been amended several times

since 1966, and Congress has never altered either section

1397(c) or section 1392(d) to provide for preemption of any

design defect claims. Indeed, two years after the Third

Circuit’s decision in Dawson, supra, which specifically called

the issue to Congress’s attention, Congress amended section

1392(d), but did not expand its preemptive effect. See

S.Rep. No. 505, 89th Cong. 2d Sess. 5 (1983). Finally, as this

Court once again reaffirmed only three weeks ago, it is “the

ordinary rule of statutory construction that if Congress in-

tends to alter the ‘usual constitutional balance between the

States and the Federal Government’ it must make its inten-

tion to do so ‘unmistakably clear in the language of the

statute.” Will v. Michigan Department of State Police, 57

U.S.L.W. 4677, 4678-79 (June 13, 1989) (citations omitted).

The majority below disregarded this rule, ignored the

16

presumption against preemption, and drastically altered the

usual constitutional balance between the States and the

Federal Government, despite the fact that Congress had

made its intention not to do so unmistakably clear.

As a result, the relationship between federal regulations

and state common law in design defect litigation is now

utterly unclear. Even under the majority below’s approach,

no one can tell which claims will have a sufficiently powerful

regulatory effect to require preemption. Does it turn on the

design in question, the purpose of the standard, the number

of people injured, the amount of damages involved, or some

other factor? Such line drawing is far better suited for

Congress than the federal courts, especially given the neces-

sity to balance the competing policy considerations. Since

Congress drew its line in sections 1392(d) and 1397(c), the

First Circuit should never have embarked on this effort.

Indeed, in some ways, the most troubling aspect of the

majority's decision below is that its implied preemption

analysis substitutes its judgment for that of Congress, dis-

regarding the proper role of the courts. The majority could

not see any reason why Congress would have wanted to

preserve common law claims that would have an effect

similar to that of a preempted state regulation. It, therefore,

almost admittedly rewrote the Safety Act to “extend [section

1392(d)] to this situation.” 865 F.2d 402, Pet. App. 15a.

There are two basic problems with this approach. First,

as this Court has previously recognized , see, e.g., Silkwood,

supra, it is entirely reasonable for Congress to preempt state

regulation and leave the indirect regulatory effect of com-

mon law claims intact. Second, the decision is one for Con-

gress, not the courts, to make. The “sole task” of preemption

analysis “is to ascertain the intent of Congress.” California

Federal Savings and Loan Association v. Guerra, 479 US.

272, 280 (1988). Given the presence of section 1397(c) and

17

the presumption against preemption, once the court below

held that there was no express preemption, that should have

been the end of the inquiry.

In enacting the Safety Act, Congress had several good

reasons for preserving all common law claims, regardless of

their regulatory effect. To begin with, Congress wanted to

further the Act’s sole stated purpose — “to reduce traffic

accidents and deaths and injuries to persons resulting from

traffic accidents,” 15 U.S.C. § 1381 — by ensuring that all

design defect victims would be compensated and by preserv-

ing the incentive for design improvement that potential tort

liability creates. Congress was well aware that the federal

motor vehicle safety standards it was authorizing the Execu-

tive branch to issue would not provide for victim compensa-

tion. It reasonably provided that state common law would

continue to fill that role.

In addition, Congress undoubtedly realized that, while

common law claims might have a regulatory impact in cer-

tain circumstances, their primary purpose is not to alter

future conduct, but, rather, to compensate victims. They

look backward in time and only alter future conduct by the

incentives they create. For example, this case is being

litigated in 1989, seeking compensation for a crash that

occurred in 1981, involving an auto manufactured in 1976.

In contrast, state safety standards are primarily intended to

affect future conduct and do not compensate victims. They

look forward in time and direct that changes be made.

Moreover, given the long history of federal regulation,

Congress was undoubtedly aware of how administrative

agencies operate and the role that common law claims can

play in enhancing regulatory performance. As history shows,

common law suits often uncover facts that prompt ad-

ministrative agencies to act and provide important protec-

tion to consumers when agencies are “captured” by the

18

industries they regulate. Indeed, Congress traditionally

preempts direct state regulation and preserves common law

claims — particularly in the area of consumer protection —

and, until the decision below, the courts have consistently

respected that decision.5

Congress may have had other reasons (or, in theory, no

reason at all), but, since Congress plainly stated its intent, the

court below should have followed it. As this Court recently

said in Goodyear Atomic Corporation v. Miller, 486 U.S. 174,

108 S.Ct. 1704, 1712 (1988), a case in which there was no

express savings clause similar to section 1397(c):

The effects of direct regulation on the operation of

federal projects are significantly more intrusive

than the incidental regulatory effects of [Ohio’s

compensatory] award provision. Appellant may

choose to disregard Ohio safety regulations and

simply pay an additional workers’ compensation

award if an employee’s injury is caused by a safety

violation. We believe Congress may reasonably

determine that incidental regulatory pressure is

acceptable, whereas direct regulatory authority is

not. Cf. Silkwood v. Kerr-McGee Corp., 464 U.S. at

> See, e.g., Abbot v. American Cyanamid Co., 844 F.2d 1108 (4th Cir.

1988) (Food, Drug, and Cosmetic Act does not preempt product liability

claims); Ferebee v. Chevron Chemical Company, 736 F.2d 1529 (D.C.

Cir.), cert denied, 469 U.S. 1062 (1984) (Federal Insecticide, Fungicide,

and Rodenticide Act does not preempt product liability claims);

Raymond v. Riegal Textile Corporation, 484 F.2d 1025 (1st Cir. 1973)

(Flammable Fabrics Act does not preempt product liability claims);

Hubbard-Hall Chemical Company v. Silverman, 340 F.2d 402 (1st Cir.

1965) (same as Ferebee); Burch v. Amsterdam Corporation, 366 A.2d 1079

(App. D.C. 1976) (Federal Hazardous Substances Act does not preempt

product liablity claims); McIntire v. Estate of Forte, 463 S.W. 2d 491 (Tex.

Civ. App. 1971) (Federal Aviation Act does not preempt common law

claims). See also 15 U.S.C. § 2074 (1976) (Consumer Product Safety Act

does not preempt common law liability).

ne "AEE § EEE *

A le 8 oe a

19

256 (Congress was willing to accept regulatory con-

sequences of application of state tort law to radia-

tion hazards even though direct state regulation of

safety aspects of nuclear energy was preempted).

For the majority below to reject this approach on the

basis of a false factual premise and substitute its own judg-

ment for that of Congress is the height of judicial activism.

Its unprincipled use of the implied preemption doctrine

creates a dangerous and open invitation to the wholesale

displacement of state law by activist federal judges. This

Court should grant certiorari and reestablish that state law

is preempted only when Congress specifically intends to do

so. Since section 1397(c) makes plain that Congress had

precisely the opposite intent, the ruling below should not

stand.

i

20

CONCLUSION

The petition for a writ of certiorari should be granted.

Respectfully submitted,

Arthur H. Bryant

(Counsel of Record)

Trial Lawyers for Public Justice, P.C.

1625 Massachusetts Ave., NW

Suite 100

Washington, D.C. 20036

(202) 797-8600

Alan B. Morrison

Public Citizen Litigation Group

2000 P St., N.W., Suite 700

Washington, D.C. 20036

(202) 785-3704

Edmund P. Daley

Mogquin & Daley

388 Commonwealth Ave.

Boston, MA 02215

(617) 536-0606

Attorneys for Petitioners