Eight floors above the palm tree-lined streets of downtown Miami, Florida, attorney Victor Diaz sits in a conference room with a large wooden table and thickly cushioned black chairs. He asks his secretary for a Diet Coke. Then he leans back, ready to talk.
'There isn't a day that goes by that this case doesn't change,' he says. Looking cool and relaxed in a short-sleeved shirt, Diaz could have been talking about the weather. Instead, he is sizing up an upcoming court decision that could bankrupt one of the world's largest tire makers.
Diaz represents more than 140 personal injury lawsuits against either Bridge-stone/Firestone Inc. or Ford Motor Co. Most of Diaz's cases were filed by U.S. citizens, but several were from other countries. Now, for a number of alleged accident victims in Colombia, Venezuela and other nations, one question looms above all others. If the accidents occurred outside the United States, can they seek judgments in U.S. courts?
A federal judge soon must decide that question. Millions of dollars could be at stake because of the United States' reputation for big judgments in product liability cases. And that could open the door to lawsuits against U.S. automakers in other cases. The stakes are high. Rollover accidents involving Ford Explorers started the recall of 6.5 million Firestone tires. At least 174 deaths in the United States have been linked to accidents involving Ford's sport-utility.
ARMY OF LAWYERS
Bridgestone and Ford are defendants in more than 330 U.S. personal injury cases. As of December 31, Ford had damage claims totaling $590 million. Last year, Bridgestone took a one-time charge of $450 million to cover damage payments.
Ford, Bridgestone and a small army of plaintiff lawyers are awaiting federal judge Sarah Evans Barker's decision on a motion to dismiss from U.S. courts 23 personal injury cases that occurred in Venezuela and Colombia. Both sides are in the middle of a 90-day period in which they will form their arguments for Barker, who has a reputation for moving high-profile proceedings quickly.
Diaz and others will argue this is a case of faulty design and poor management decisions, both of which happened in the United States. 'This is a U.S.-designed product where all of the liability decisions that give rise to this problem were made in the U.S. by U.S. executives,' Diaz says.
Venezuela's consumer protection agency is exploring allegations that the two companies suppressed information about tire defects. Though a decision to prosecute would come from the public prosecutor's office, the agency is reviewing claims that Bridgestone and Ford knew about the problem at least two years before the recall. Because Venezuela lacks tough product liability laws such as those in the United States, some plaintiffs are turning to U.S. courts.
The U.S. court's decision will affect how quickly a case may be brought to trial, how it will be tried and the size of a potential award. Diaz does not comment on the likely size of awards for non-U.S. plaintiffs. But he does say that non-U.S. courts have not handled cases as numerous and as large as these.
A court order issued by Barker hinted that Bridge-stone and Ford face a tough battle in having the non-U.S. cases dismissed. Barker wrote that Ford has made 'a number of sweeping assertions' in support of its motion in the Venezuelan cases. They include claims that Explorers were made in Venezuela by Venezuelan companies, and that most of the Firestone tires involved also were made in Venezuela.
Ford attorney John Beisner offers a different interpretation.
'The accidents occurred in a foreign country,' he says. 'Claims ought to be asserted in that foreign country. You would have more access to information and more access to the witnesses there. It's not clear that we have that access now.'
While plaintiffs argue that faulty design in the United States is the central element to the lawsuits, Beisner sees that as a side issue. 'The U.S. courts should not become a magnet for any claim that arises anywhere in the world just because there happens to be a U.S. design component to the product,' Beisner says. 'The legal system would be overwhelmed.' Beisner also argues it would make no sense to argue claims made in the United States by foreign plaintiffs. 'There was a breach of duty under Venezuelan law,' he says.
Ford and Bridgestone have until June 10 to supply evidence in support of their motion. Plaintiff attorneys will have 30 days to counter arguments made by the companies. Thereafter, the decision belongs to Barker.
TROUBLE AT HOME
Anyone who wonders about the consequences of Barker's decision might want to visit Ralph Patino. He is an attorney in Coral Gables, Florida, and he has spent a lot of time talking to accident victims. Piled on his office desk is a stack of plastic-bound files, each representing a lawsuit filed against Bridgestone or Ford.
Patino picks up a file and flips through the pages. 'This one happened in Illinois,' he says. 'A girl was driving with her friend and her friend's boyfriend. They were college students.' He holds a color photograph taken on the shoulder of a highway at night. 'This is her friend's body lying in the road, covered with blankets.' He flips through another file. He displays a family portrait of a mother, a father and a 4-year-old. He turns the page to the same portrait but with the mother missing. 'She was killed,' he says. 'We airbrushed her out for effect. Each one of these is worse than the next, it seems. It's hard to look at these and not feel anything, you know?'
In U.S. courts, 95 percent of all cases are settled before reaching trial. It is too early to tell whether Bridgestone and Ford will settle all lawsuits, but lawyers on both sides have commended Barker's court for encouraging out-of-court settlements.
Barker oversees more than 130 personal injury cases, which a panel of U.S. judges had consolidated because of common liability issues. More than 200 other personal injury cases are scattered in state courts nationwide.
Also in front of Barker are 70 class action lawsuits calling for an expansion of the Firestone tire recall. These lawsuits, which were consolidated in January, ask that Ford and Firestone recall millions of additional tires and replace Firestone tires used as replacements during the initial recall. The companies, confident they have taken action to fix the tire problem, will not attempt to settle the class action lawsuits. The decision is before Barker. Because of the time involved in federal court proceedings, no trial will be set earlier than January 2002, and no trial will be likely until that summer.
Bridgestone says it is not worried that a high-profile trial could further damage its image. Still, it faces plaintiffs such as Randy Smithwick, a soft-spoken man who sits with his wife and one of his 15-year-old daughters in an attorney's office in Coral Gables. The other daughter has left the room, crying.
'That happens more and more since the accident,' he says. He pauses, reflecting on the events of August 3, 2000. His Firestone tire unraveled, flipping over his vehicle. Trapped inside the crumpled 1998 Explorer was one of his daughters, who suffered broken ribs and a neck injury. 'The hardest thing I ever had to go through,' he says softly, 'was lying there in the hospital, looking next to me and seeing my daughter. And there wasn't anything I could do about it.'
Bridgestone says it has not found a flaw in its tires, though it does not deny their failures have contributed to accidents. But while one trial jury has concluded that the Explorer is a safe vehicle, the tire maker has no such consolation. Instead it has plaintiffs such as Smithwick with haunting memories.
E-mail writer Joe Kohn at [email protected]