Ford Stonewalls on Evidence, Judges Say

Ford has dragged its feet, misled plaintiffs and lied in a number of lawsuits, jurists in those cases contend. The automaker calls the incidents 'honest mistakes.'

By Myron Levin, Los Angeles Times

Tough" is a word that Ford Motor Co. likes to use in marketing its popular pickup trucks, as in "Built Ford Tough." The term could also be applied to Ford's take-no-prisoners style in defending itself against product liability suits.

Some judges who have heard cases involving Ford from Mississippi to Michigan to California have used far stronger language to describe the automaker's courtroom conduct:

"Totally reprehensible."

"Disgusting."

"Blatantly lied."

"Almost borders on the criminal."

In recent years, Dearborn, Mich.-based Ford has been painted in courtroom after courtroom as something of a renegade, accused by judges of hiding or misrepresenting evidence.

Ford is hardly the only big company to be cited for such behavior. Others, from automotive rival General Motors Corp. to British American Tobacco, also have been sanctioned for failing to produce relevant documents. Yet Ford appears to have a special knack for antagonizing judges.

"Why is it that Ford has this attitude that they don't have to comply with a clear order" to give up certain documents? U.S. District Court Judge T. John Ward asked at a July 2001 hearing in Texas. "You can take it back to Dearborn: This court is not impressed with the … lack of candor that I find from Ford's counsel."

Early last year, Ford was forced to pay more than $700,000 in Michigan after exhausting its appeals of sanctions for failing to produce test reports in the case of a seat belt failure that left the victim a quadriplegic.

Last summer, a Mississippi judge tossed out a verdict in Ford's favor and ordered a new trial in the case of two students killed in the fiery wreck of a Ford Explorer. Ford had waited until the trial began to turn over thousands of pages of documents — a "willful and blatant" violation of court rules, said Hinds County Circuit Court Judge Winston L. Kidd. For good measure, he ordered Ford to reimburse more than $200,000 in plaintiffs' trial expenses. Ford has appealed.

Ford's problems in this area aren't new. In the early 1980s, prior to introduction of the Bronco II SUV, Ford's office of general counsel took the unprecedented step of collecting documents on the handling characteristics of the rollover-prone vehicle. Court cases later revealed that 53 of 118 crucial documents snagged in the roundup were lost or destroyed.

In 1996, Marion County Circuit Court Judge David L. Rimstidt in Indiana called the disappearance of the records a "sanitization" at best, and "at worst … an outright fraud."

Company spokeswoman Kathleen Vokes said Ford "makes a good-faith effort to cooperate" with judges and opponents.

"Like other major companies, we have been sued tens of thousands of times … and have produced millions of documents," Vokes said. "With this volume of litigation involving a company as large and complex as ours, it is inevitable that we … will make some infrequent and honest mistakes."

As John F. Murphy, an outside attorney for Ford, argued at a sanctions hearing in Missouri: "There's been this misimpression that somehow all Ford needs to do is touch a button on the computer and every document that has been produced in the last 40 years at Ford suddenly appears."

Court sanctions against Ford typically have come in cases in which judges found that the company abused the discovery process, in which parties in a lawsuit are supposed to exchange relevant information before trial.

Plaintiffs in automotive cases try to sift through documents for evidence that manufacturers may have cut corners to shave costs, or ignored safety recommendations of engineers. Yet corporate defendants often balk at handing over documents for months or years on grounds that they can't be located or would expose trade secrets. A certain amount of resistance is regarded as a normal part of the litigation game — but Ford has been accused of going to extremes.

Frank Branson, a Texas lawyer who has often tangled with the company, said he "can't remember encountering a defendant who set about in a more orchestrated way to conceal evidence from the public's eye and from disclosure in courtrooms."

Critics say Ford stonewalls not only in court but also in its dealings with regulators. The company has been cited repeatedly by federal officials and judges for withholding information from the National Highway Traffic Safety Administration.

The Environmental Working Group, a Washington-based advocacy organization, recently asked the Justice Department to investigate what it called Ford's "practice of willfully concealing safety-related data from courts, regulators and consumers" — a charge Ford called false and irresponsible.

It isn't clear why Ford approaches litigation the way it does. At a deposition in January, Ford Chairman William Clay Ford Jr. was questioned about a string of cases in which judges had savaged Ford for its conduct. He testified that he was unfamiliar with each of the cases, and said he relied on Ford's office of general counsel to alert him to matters requiring his personal attention. He described the office's lawyers as people of "the utmost integrity."

Lawyers currently or formerly in Ford's general counsel office didn't respond to requests for interviews.

To some, it seems obvious what lies behind Ford's strategy: saving money.

Although sanctions have proven costly to Ford in isolated cases, company critics say its tactics have reduced lawsuits; many plaintiffs' lawyers are scared off by the prospect of exhausting discovery battles.

Though Ford isn't unique in embracing this strategy, "they've been an outstanding practitioner of it," said Tom Feaheny, a Ford vice president in the 1970s and '80s who now testifies as an expert witness against the company. As a result, "an awful lot of plaintiffs go away."

Ford and other automakers have denounced product litigation as a money grab that tries to shift blame away from people who didn't wear seat belts or drove while drowsy or drunk. "That's why we think things are stacked against us," said a former Ford official who would not speak for attribution.

Vincent Galvin, a San Jose lawyer who has defended Ford and other automakers, contends that plaintiffs often contrive discovery disputes to distract from the weakness of their cases. It's "a ruse … to get a sanctions order to try to pressure the defendant to settle," he said.

That indeed may occur, said Stephen Gillers, vice dean of the New York University School of Law. But when it comes to Ford, he's skeptical. "Once you have five, six or seven incidents of failure to produce documents," Gillers said, "it's hard to explain it as purely the machinations of a devious plaintiffs lawyer."

In the mid-1990s, Ford announced a more pugnacious litigation strategy, vowing to try more cases and offer settlements on a take-it-or-leave-it basis.

"If the plaintiff doesn't settle, it doesn't matter to us," former Assistant General Counsel James Brown told the National Law Journal in 1996. "We tell them, 'We're coming after you.' "

That didn't mean Ford wouldn't cooperate with judges and opponents, Brown said. "Ford wants to have the reputation that we're open and honest in the discovery process."

At the time, Ford was having its reputation shredded by a judge in its home state of Michigan. The suit was filed by the parents of Sarah Traxler, who suffered severe brain damage when she was 2 months old. Sarah was riding in her car seat in the back when the family's Ford Tempo was rear-ended, causing her mother's seat back to collapse on the baby. The suit claimed the seat was defective because it wasn't designed to withstand a routine collision.

Kent County Circuit Judge Dennis C. Kolenda issued a default judgment against Ford in January 1997, citing its "disgusting" failure to cooperate in discovery.

In a default judgment, the judge ends the trial and issues a verdict against one party for failing to meet its obligations.

Ford had perpetrated "an outrageous fraud," according to the ruling. The company had "concealed very significant documents and … worse, had blatantly lied about those documents," Kolenda said. "Any word other than 'lied' would understate what Ford did."

Among other things, the judge found, documents showed that Ford had concealed safety tests and the existence of hundreds of similar lawsuits, and had developed — but not used — a seat capable of withstanding much greater rear-end impacts. Ford appealed and eventually settled.

Another default judgment was issued against Ford in October 2001 in a New Mexico case filed by the widow of John F. Sturdevant, who died when his F-350 pickup rolled over and the roof collapsed.

Sturdevant's lawyers knew Ford had considered reducing the thickness of steel in the roofs of its trucks to save money. Ford lawyers insisted there were no records showing whether the change had ever been implemented.

However, the supposedly nonexistent documents turned up in another fatal roof-crush case in Missouri. The Sturdevant lawyers eventually got the records by getting in touch with plaintiffs in the Missouri case. one of the documents appeared to show that Ford had thinned the roofs for a savings of about 66 cents per vehicle.

District Judge Art Encinias issued a default judgment against Ford, and the case was eventually settled.

In October, discovery abuse figured prominently in a $45.4-million verdict against Ford and two trucking firms in Los Angeles County Superior Court in Chatsworth.

The suit stemmed from the paralyzing injuries suffered by 5-year-old Johan Karlsson of Orange County in the crash of his family's '96 Windstar minivan. The minivan struck a roll of steel that had fallen onto Interstate 5 near Gorman after two big-rig trucks collided. Johan, whose rear-center seat was equipped with a lap belt only, suffered a severed spine when the minivan slammed to a stop. Six family members wearing shoulder and lap belts sustained lesser injuries.

Johan's parents and the insurer for one of the trucking firms sued Ford, claiming the lap-belt-only design was defective.

A bitter, nearly four-year discovery battle ensued. Ford had created reading rooms at its Dearborn headquarters to store records pertinent to certain categories of lawsuits. The company told the Karlsson lawyers that seat-belt-related documents could be found in one of those rooms.

But after months spent reviewing thousands of records, it became clear that the most crucial ones — on the design of rear restraints in the Windstar — were missing from the collection.

It was "a classic case of giving too many documents to overwhelm an adversary," complained Thomas F. Nuss, a retired judge serving as discovery referee. If Ford did not know what was in the reading room, he said, it should not have sent the plaintiffs there.

Most of the review was done by Gregory Scott, a paralegal. By sheer accident, Scott discovered some of the missing papers in another reading room about two years later while reviewing records for a different case. The papers showed that a Ford contractor had built a prototype restraint system of the kind the plaintiffs said could have prevented Johan's injuries.

But when asked for the prototypes, Ford said it was unable to produce them.

"They're trying to bury the attorneys who are fighting them on these cases," Agneta Karlsson, Johan's mother, said in an interview. It's "scary for a big corporation to behave like that."

Los Angeles County Superior Court Judge Howard J. Schwab instructed jurors to accept as proven that the lap-belt-only design was inadequate and that Ford had not warned owners of this fact.

The jury awarded $30.4 million in compensatory damages and $15 million in punitive damages against Ford and the trucking companies. Ford has appealed, contending that the sanctions were unwarranted and had "severely prejudiced" its defense.

In February 2003, Ford came under scathing attack by a federal judge in Chicago for misrepresenting evidence in the case of a rollover of a 15-passenger van.

Two people died and several others were seriously injured when the driver dozed off and grazed a guardrail. The van then flipped as the driver tried to steer back onto the highway. one of the dead was Julia Whitley, a foster mother of 10 children.

The plaintiffs claimed that Ford knew its large passenger vans were unusually prone to flipping over in sudden steering maneuvers. As it had done in previous cases, Ford asserted that computerized stability tests used in analyzing other Ford vehicles had not been performed on the vans. The company further claimed that it had never experienced a rollover of the vans in handling tests.

It turned out Ford had done the computer analysis, and a Ford test driver acknowledged that he had rolled a van while driving a slalom course at about 40 miles per hour. He testified that he had been told not to file a report on the incident — and that the instruction came from a Ford engineer who already had testified that no rollovers took place.

Defense lawyers said Ford had made an "honest mistake" in interpreting the questions.

U.S. District Judge Robert W. Gettleman would have none of it, indicating that he would instruct the jury that Ford had concealed test data showing the vans were "unsafe in handling and stability."

"It almost borders on the criminal," Gettleman said. "Somebody is committing perjury … or at least may be committing perjury.

"I don't want to believe a corporation like Ford does stuff like this," Gettleman added, but "I'm being convinced against my own instincts."

Ford paid a confidential settlement just before trial.