Trial News

An Arizona appellate court has ruled that a defective design suit against Chrysler and two other automakers for failure to make collision avoidance technology, specifically automatic emergency braking (AEB), a standard feature is not preempted by a lack of regulation of this technology at the federal level. The court held that the National Highway Transportation Safety Administration’s (NHTSA) decision not to regulate AEB was driven by automakers’ voluntary installation of the technology at a much faster pace than a regulation could require—not by questions of safety or necessity—and that this did not preclude state law tort claims related to the technology. (Varela v. FCA US LLC, 2020 WL 2123281 (Ariz. App. Ct. May 5, 2020).)

When Melissa Varela’s vehicle was rear-ended by a 2014 Jeep Grand Cherokee, she was injured and her four-year-old daughter, who was sitting in the backseat, was killed. Varela sued the automakers, alleging that the Jeep should have been equipped with collision avoidance technology that would have prevented it from crashing into her car or at least lessened the force of the crash. The automakers offered the technology as standard on the two most expensive models of its Jeep Grand Cherokee, as an option on the two mid-tier models, and not at all on the least expensive model. The Jeep that crashed into the plaintiff’s car was a mid-tier model, but the owner had not purchased the crash avoidance package. The plaintiff asserted negligence and design defect claims against the automakers.

The trial court dismissed the case on the ground that the plaintiff’s claims were preempted because of NHTSA's decision not to regulate this type of technology—known as “implied obstacle preemption” because a state law tort claim would interfere with “‘the accomplishment and execution of the full purposes and objectives’ of a federal law or regulation.” Here, the implied obstacle was that holding an automaker accountable for failing to make the technology standard interferes with the agency’s objective—it chose not to regulate the technology.

The plaintiff appealed, and the state appellate court reversed, finding that NHTSA did not have an objective to prevent AEB on vehicles—by contrast, it lauded automakers’ decision to voluntarily install the technology—and that its decision not to currently regulate AEB did not affect state law tort claims for design defect involving a particular vehicle model and particular AEB technology.

The court analogized the plaintiff’s claims to Sprietsma v. Mercury Marine (537 U.S. 51 (2002)), which involved a design defect claim for failure to install propeller guards on an outboard boat motor. The defendants argued that the U.S. Coast Guard’s decision not to enact a regulation for propeller guards meant that the claim was preempted. But the court ruled that the decision not to create such a regulation—for reasons such as how feasible a universal guard would be and a lack of data on whether guards were needed—was not an obstacle to a common tort claim that the particular motor at issue should have been designed with propeller guards.

In Varela’s case, the court pointed to how NHTSA has been researching collision avoidance technology for more than 10 years and noted that the agency has added some types of this technology—including forward collision warning and AEB—to the program it uses to evaluate the safety performance of new cars. The agency also has encouraged automakers to install this technology, with 10 of the largest automakers committing to do so by 2022—including the defendants. NHTSA has endorsed the technology and has delayed regulation largely for administrative reasons and because many automakers had begun moving forward with installing the technology voluntarily. The plaintiff’s claim would not affect “a significant regulatory objective” because NHTSA supports the automakers that have installed this technology and any decision not to regulate it was not the result of concerns about the technology’s safety or necessity.

Because NHTSA has reviewed and approved the AEB technology that the defendants use, the court homed in on the fact that the plaintiff alleged only that the defendants should make standard an existing technology that it offers on other models of its vehicles. This is different from asserting that an automaker should have installed another type of AEB or that it should perform to a particular standard, the court explained.

Phoenix attorney G. Lynn Shumway, who represents the plaintiff, said that this technology should not be considered optional. “There is a very long history of government encouraging installation of this available technology, but it has only been done in luxury vehicles in low volume for a long time. This case gives the greenlight to others like it.”

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