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Time to Jail Auto Executives?

More than 100 people have been killed in accidents caused by GM’s faulty ignition switches.

As many as 89 people have been killed in Toyota sudden acceleration accidents.

In 2014, the manufacturers of motor vehicles sold in America recalled sixty-four million vehicles.

A consortium of ten automakers led by Toyota have funded an engineering firm to develop a fix to the Takata airbag problem.

Federal prosecutors have launched criminal investigations at GM and Takata.

Rather than allowing these automobile industry debacles to float by without inspiring systemic change that will save lives, criminal prosecutions should become an integral part of — even a priority for — both federal and state governments.

That’s the take of University of Maryland Law Professor Rena Steinzor in a new article titled (Still) Unsafe at Any Speed — Why Not Jail for Auto Executives? (Harvard Law and Policy Review, Summer 2015).

“The regulatory system was intended to prevent such deadly outcomes, but it has failed,” Steinzor says. “Congressional action does not seem likely for the foreseeable future. Automakers have grown so complacent that they view billions of dollars in civil penalties and tort damages as unfortunate but routine costs of doing business.”

“When the corporation is targeted as solely responsible for fatal defects, the legal system fails to instill the wariness in top executives that is essential if senior and midlevel managers are to make consumer safety their top priority.”

Steinzor says that too many companies — and GM is a prime example — have internal cultures of going along to get along that make safety defects recede into the background.

“To reverse these troubling trends, individual executives with the power to establish early warning systems and repair defects quickly must perceive a personal threat if they do not act,” she writes. “Individual prosecutions are possible under both federal and state criminal law. Federal statutes authorize felony prosecutions for offenses such as lying to law enforcement officials that may well apply to defect cases. State criminal laws have a long tradition of punishing reckless homicide, also known as willful manslaughter.”

Steinzor wants criminal prosecutions of individuals in the automobile safety defect cases.

She wants the prosecutors to build on recent boomlet of such prosecutions, with U.S. Attorneys in five states obtaining indictments against individual corporate executives in six cases where corporate malfeasance killed and injured workers, consumers, or the environment.

The cases involve drinking water contaminated by a rusted chemical tank leak in West Virginia,  tainted steroid injections shipped nationwide by a small compounding pharmacy in Massachusetts, a massive explosion in an underground mine owned and operated by now-defunct Massey Energy, again in West Virginia,  cantaloupe infected with bacteria at a farm in Colorado,  peanut paste laced with salmonella and shipped from Georgia despite positive tests for the bacteria — and the infamous Macondo well blowout that destroyed the Deepwater Horizon oil rig and spilled 205 million gallons of crude oil into the Gulf of Mexico.

Steinzor reports that 136 people were killed in these incidents, and hundreds were sickened or injured.

She says that although the Department of Justice does not maintain a database that keeps tallies of such prosecutions, the cases are unusual, if not unprecedented, for four reasons.

They target individuals at the high end of the corporate chain of command.

They involve the criminal provisions of statutes that are rarely invoked, including ones that categorize crimes as misdemeanors.

And most importantly, she says, they have led to the consideration of criminal prosecutions in the automobile safety defect cases considered.

Russell Mokhiber edits the Corporate Crime Reporter.

 

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Russell Mokhiber is the editor of the Corporate Crime Reporter..

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