The National Highway Traffic Safety Administration (NHTSA) announced recently
that it has imposed a $70 million fine on airbag manufacturer Takata for
producing defective air bag assemblies that have led to eight known deaths,
over 100 confirmed injuries, and a recall affecting 19 million U.S. vehicles.
The fines could include an additional $130 million if Takata does not
comply with the terms of the consent order, according to a
recent article in the
Wall Street Journal.
Under the terms of the settlement agreement, Takata will pay the $70 million
fine in six installments over the next five years. If the company does
not meet the terms of the settlement agreement or violates another U.S.
federal law, the total size of the fine will increase to $200 million.
The $200 million total makes the fine levied on Takata the largest civil
penalty ever imposed for a violation of the Motor Safety Act, according to a
NHTSA press release. The size of the fine is related not only to the fact that Takata placed
a dangerous product on the U.S. market, but also to the fact that the
company initially denied the problem, offered incomplete or manipulated
data, and was allegedly less than forthcoming in offering details about
the product. Takata's actions have caused automaker Honda to officially
announce that it was severing its relationship with the airbag manufacturer.
The defect can cause the airbag's inflater to explode, throwing shrapnel
into the vehicle's interior and causing serious injuries or death.
Missed the latest news about the Takata air bag recall? Catch up here:
Expanded Takata Airbag Recall Goes National - New Information.
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