LEVENTHAL, Circuit Judge:
This case represents the first appellate examination of the defect notification provisions of the National Traffic and Motor Vehicle Safety Act of 1966.
The Government filed an action in the District Court for a declaration that General Motors Corporation (GM) violated this Act by failing to notify purchasers of 3/4 ton 1960-65 model year Chevrolet and GMC pickup trucks (Trucks) equipped with three-piece 15 × 5.50 Kelsey-Hayes disc wheels (Wheels) of a defect in the Wheels relating to motor vehicle safety. The District Court concluded that a "defect" existed whenever there was "a large number of failures of components or materials, i. e., failures in performance, regardless of the cause."
This case focuses on the meaning of § 113 of the Act, set forth in pertinent part in the margin.
The primary question presented by this appeal is whether the District Court erred in concluding that undisputed proof of a large number of Wheel failures conclusively established a "defect" within the meaning of the Act, and that the cause of such failures was immaterial. GM contends that no defect exists unless a significant number of failures occur in vehicles operated in conformity with the manufacturer's specifications. Specifically, GM argues that the Wheel failures were a product of owner abuse—overloading the Trucks with heavy campers or special bodies—and that the Wheels are suitable for uses that comply with the weight limitations set forth in the owner's manual. Alternatively, GM asserts that prior letters sent to owners describing the dangers created by overloading Trucks equipped with the Kelsey-Hayes wheels comply with the requirements of the Act and constitute a defense against the present enforcement action.
Our survey of the Act's purpose and legislative history leads us to reject
This view of the legislative contemplation leads us to conclude that the District Court's grant of summary judgment must be reversed, because there are presently genuine issues of material fact regarding GM's defense that the Wheel failures stem from unforeseeable overloading of the Trucks.
We begin with a brief description of the vehicle component involved in this case, the administrative proceedings culminating in the present enforcement action, and the proceedings in the District Court.
A. The Kelsey-Hayes Wheel
The three-piece 15 × 5.50 Kelsey-Hayes disc wheel was introduced by GM in the fall of 1959, the beginning of the 1960 model year, as an option on its 3/4 ton Chevrolet Series 20 and GMC Series 1500 pickup trucks. The Wheels proved to be an extremely popular option—a total of 810,000 Wheels were installed on approximately 200,000 of the 321,743 GM trucks manufactured during the 1960-65 model years.
The load carrying capabilities of the trucks equipped with Kelsey-Hayes wheels depended on which of three different tube tires was selected by the purchaser. The maximum load capacity of a truck is its gross vehicle weight (GVW)—the sum of the curb (empty) weight of the truck itself and the maximum load. The gross vehicle weights of Trucks here involved ranged from 5,500 lbs. with 700 × 15 6-ply tires, to 6,000 lbs. with 700 × 15 8-ply tires, and 6700 lbs. with 7.50 × 15 8-ply tires. While the maximum load capacity of the Kelsey-Hayes
Each Truck came with a permanently affixed GVW plate stating that the maximum GVW rating was 7500 lbs. This 7500 lb. figure on the plate is in excess of the 5500 lb. GVW of Trucks with the standard wheel and tire, available without extra charge,
Information on the tire-wheel capacity of particular tire-wheel combinations was set forth in the owner's manual in a table marked "Tire Inflation Tables for Highway Service." Also in the owner's manual was a table listing gross vehicle weights, referred to in some manuals as "load capacity chart." This table listed gross vehicle weights for various combinations of tires for front and rear wheels (sometimes with notations of necessary equipment such as heavy duty springs). However, this table did not show gross vehicle weight for any of the 15-inch tires used with the Kelsey-Hayes wheels.
General Motors discontinued the Wheel as an available option at the end of the 1965 model year.
B. Administrative Proceedings
A September 4, 1968, letter from Ralph Nader, the noted exponent of consumer causes, reported an injury-producing accident caused by the failure of a Kelsey-Hayes wheel. This prompted the National Highway Safety Bureau (NHSB) (now the National Highway Traffic Safety Administration) to initiate an investigation to determine whether the Wheel contained a safety-related defect.
Following the completion of the initial investigation, meetings were held between NHSB personnel and GM representatives. Although persisting in its claim that there was no defect and therefore no obligation under the Act to issue notifications, GM advised the agency on April 19, 1969, of its plans to notify each owner of a truck equipped with Kelsey-Hayes wheels of the dangers
Part II of NHSB's Investigation Report, dated August 12, 1969, reaffirmed the agency's earlier findings and recommendations. It rejected GM's overloading theory, finding that "96 percent of all known wheel failures have occurred under loads which are below the design wheel strength level specified" by GM and that metallurgical analyses indicated manufacturing defects. In addition, the report concluded that the May 28 bulletin was deficient.
Prior to a ruling by the Administrator in the defect proceeding, GM submitted a settlement offer. By letter of October 3, 1969, GM proposed "as a matter of customer relations" to send a second bulletin warning owners about proper loading and tire inflation and offering to replace, at GM's expense, the three-piece Kelsey-Hayes wheels on those trucks—estimated at 50,000 in number—on which campers or other special bodies had been installed by the owners. The settlement offer set forth GM's understanding that its proposed action would moot the pending defect proceeding with the result that the investigation would be closed "immediately" and "not be subject to reopening."
In November, 1969, Secretary of Transportation Volpe, in response to a letter written by Ralph Nader criticizing the settlement, stated that NHSB was carrying forward its survey of the plain trucks (not equipped with campers or special bodies)—estimated at 150,000 in number—to determine whether corrective measures were indicated.
Two weeks before its progress report was due, the agency completed Part III of its Investigation Report. This report found that there were 98 known failures on plain trucks and contended that "[a] significant number of wheel failures has occurred on [plain] trucks . . . under loads which are below wheel strength level specified" by GM.
On the same day, GM filed an action in the United States District Court for the District of Delaware seeking injunctive and declaratory relief with respect to the NHSB's directive. Two days later, on November 6, 1970, the Government brought the present enforcement action in the United States District Court for the District of Columbia. GM's pre-enforcement action in Delaware was dismissed, and GM was remitted to presenting its challenges as defenses to the Government's enforcement action.
C. Proceedings in the District Court
Shortly after the Government filed its enforcement action, GM moved to dismiss, transfer, or stay further proceedings in view of the pre-enforcement action it had filed in Delaware. As a result of delay attributable to the jurisdictional question, defendant did not file its answer until February 3, 1971, and discovery did not commence until April. Following more than a year of extensive discovery by both parties, the Government moved for summary judgment on July 12, 1972. The Government's motion rested on the theory that a defect could be established by showing a large number of failures in performance.
GM filed its initial opposition to the summary judgment motion on May 15,
On April 30, 1974, in the light of Judge Waddy's illness, the case was reassigned to Judge Gasch. He held a hearing on the summary judgment motion on May 22, 1974, and issued an opinion and order granting summary judgment on June 13, 1974. The District Court found that the Government's large number of failures theory was supported by the purpose and plain language of the Act, the administrative construction of the statute, and the need for practical and effective enforcement. It rejected GM's contention that the 1969 bulletins limited the scope of the enforcement proceeding to non-overloaded plain trucks.
Following the summary judgment ruling, GM applied to the District Court for a stay pending appeal. The District Court denied defendant's motion on June 26, 1974.
II. DEFINITION OF DEFECT
The District Court found that Congress intended "to have the manufacturer issue such [defect] notifications not only when there was a cognizable defect in design or manufacture but also when the evidence reveals a large number of failures of components or materials, i. e., failures in performance, regardless of the cause." (Emphasis in original.)
The District Court added: "This statute is designed specifically to warn a consumer before an accident occurs and a defect in performance, such as a `large number of failures,' exposes the consumers to dangers of which they should promptly be notified." In its footnote 20, the court amplified: "Where the agency shows that there is a prima facie case of a defect in performance through the submission of evidence of a large number of failures of the Wheel, the only defense in such an instance is that this large number of failures did not occur for it is clear the failures of wheels are clear dangers to motor vehicle safety."
GM concedes that a defect finding can be premised on a significant number of
For the reasons developed below, we find that the District Court erred in holding that the cause of failures is irrelevant to the defect determination. We also reject GM's specified use formulation of defect as unduly restrictive and not in conformity with legislative intention.
A. Statutory Provisions
This enforcement action is brought pursuant to the Secretary of Transportation's determination under § 113(e) of the Act that the Wheels contain a "defect which relates to motor vehicle safety."
These provisions indicate that a determination of "defect" does not require any predicate of a finding identifying engineering, metallurgical, or manufacturing failures. A determination of "defect" may be based exclusively on the performance record of the vehicle or component.
The District Court concluded that "the plain language" of the sections, when read in conjunction with the statutory purpose "to reduce traffic accidents," "forcefully demands" that defect notifications be sent whenever there are a large number of failures.
B. Legislative History
The National Traffic and Motor Vehicle Safety Act of 1966 was a product of the heightened public interest in, and concern over, automotive safety during the mid-1960's.
An Administration bill was introduced in both chambers in March, 1966. The
Neither the original House or Senate bills contained a defect notification provision.
Senate consideration of this amendment and House examination of similar amendments reaffirmed the need for "uniform and prompt notification to vehicle owners of the discovery of any defects related to safety,"
Legislative History and GM's Intended Use Formulation
In its argument in the District Court, GM seized on the language of the Senate Report and the absence of any meaningful statutory definition to argue
In its brief on appeal, GM contends that the District Court's standard ignoring the cause of performance failures cannot be squared with the common meaning of a defect. Appellant puts it that "an item of equipment cannot be called `defective' in any sense if it only fails to operate properly when the applicable instructions and warnings are ignored."
GM's approach does not measure up to the purpose of the defect notification provision and the statute as a whole. Congress was concerned with the day-to-day performance of motor vehicles in the myriad conditions of use experienced by the public, not the test data compiled by professional drivers on the manufacturer's proving grounds or performance specifications under laboratory conditions. The protection afforded by the Act was not limited to careful drivers who fastidiously observed speed limits and conscientiously complied with manufacturer's instructions on vehicle maintenance and operation. The mood of the statute is fairly identified by the comments of various Senators espousing the proposed legislation even before the notification provision was added by the House, as affording, in the words of Senator Hartke, "an added area of safety" to "an owner who is lackadaisical, who neglects regular maintenance, and doesn't switch his tires, doesn't keep them at proper pressure," and as observant that "this is the human factor we are talking about."
GM's contention that there can be no "defect in performance" so long as the Wheel does not fail under loads specified by the manufacturer is undermined by its own description of the manner in which purchasers normally operate their trucks. As GM's counsel stated during the administrative proceeding: "We know, we always have known, everybody knows that trucks are overloaded on occasion."
When pressed at argument on appeal, counsel for GM conceded—what could not fairly be denied—that "it may very well be true that a manufacturer would have an obligation to anticipate some degree of misuse perhaps or failure to maintain and build in some additional margin for his product." The congressional purpose to warn owners about safety hazards requires notice not only where the vehicle fails when used in conformity with manufacturer's instructions, but also when there is an inadequate margin of safety to protect against failures during reasonably expected vehicle operation.
Legislative History and the District Court's Definition
While the District Court was on sound ground in rejecting GM's specified use theory, it went too far in the other direction when it held that the cause of component failures was irrelevant to the defect determination. That ruling conflicts with the legislative history of the 1966 Act.
The Senate Report indicates that the "critical definitions which delimit the scope of the bill are those of `motor vehicle' and `motor vehicle safety.'"
Similarly, a commonsense approach would not find defective a wheel that collapsed under a load, say, four times that specified, and, say, twice the load that might be projected as a use (or technical over-use) that could be deemed a realistic expectation. The District Court's decision that a large number of failures, regardless of cause, constituted irrebuttable proof of a "defect," ignores these commonsense limitations and must be rejected as incompatible with the discernible legislative intention.
C. Subsequent History Clarifying Legislative Intent
Amendments to the Act contained in the Motor Vehicle and School-bus Safety Amendments of 1974 require manufacturers, in addition to furnishing defect notifications, to correct at their expense defects which relate to motor vehicle safety. The amendments neither alter the Act's definitions of defect and motor vehicle safety nor establish separate criteria for the manufacturer's notification and repair obligations.
We are aware that subsequent congressional actions may provide "a hazardous basis for inferring the intent of an earlier" Congress.
In general, the contours of the defects the manufacturer must remedy fairly delineate the defects that must be notified. We are on sound ground, then, in turning to the legislative understanding of those contours—expressed at a time when it was not making any change in the provisions that define them. In this context, we deem the 1974 House Report, which provides for some defense of abuse, to be a reliable explication of the scope of the original defect notification section.
D. Administrative Interpretation
The District Court rested in part on the doctrine "[t]hat Courts should give great weight to any reasonable construction of a regulatory statute adopted by the agency charged with the enforcement of that statute."
E. Establishing a Defect in Performance
The District Court settled on its definition of defect in part because it feared that an alternative interpretation
An enforcement proceeding under the Act is a trial de novo with the burden on the Government to prove a violation by a preponderance of the evidence. In discharging its burden in the present action, the Government need only establish a significant number
The presumption arising from proof of a significant number of wheel failures is not irrebuttable. It is here that we depart from the District Court, which tolerated no defense other than proof that the failures did not occur. We hold that the Act permits the manufacturer to establish, as an affirmative defense, that the failures were attributable to gross and unforeseeable owner abuse or unforeseeable neglect of vehicle maintenance.
We have pondered the possibility that our approach may enable a manufacturer to attempt to avoid notice and correction obligations by dragging out the enforcement proceedings. That danger would appear inherent in any scheme designed to afford the manufacturers a fair opportunity to establish that gross and unforeseeable owner abuse caused the component failures. The danger is mitigated somewhat by the 1974 amendment allowing the Secretary to order provisional notification pending the resolution of the enforcement action.
III. PREVIOUS OWNER LETTERS
GM contends, as its second claim of error, that the letters sent to Truck owners in May, 1969, and October, 1969 comply with the notification requirements of § 113 of the Act and therefore constitute a defense to the present enforcement action.
The District Court concluded that the prior settlement letters did not preclude the Government from relying on all available evidence to prove a safety-related defect. Under its large number of failures theory, the District Court found, on the basis of owner affidavits revealing numerous wheel failures, that all of the three-piece Kelsey-Hayes wheels were defective and ordered enforcement of the Administrator's notification directive.
Beyond this basic problem with appellant's proffered defense, there are deficiencies in the 1969 bulletins which undermine their adequacy. The purpose of the defect notification provision is "to notify the owner in clear and unmistakable terms" of the specific safety-related defect so that "corrective steps" could be taken.
IV. SUMMARY JUDGMENT
A. General Principles
Our refinement and modification of the legal standard used by the District
Summary judgment under Fed.R.Civ.P 56 eliminates useless trials by permitting a party "to pierce the pleadings and to assess the proof to see whether there is a genuine need for trial.
The party seeking summary judgment has the burden of showing there is no genuine issue of material fact,
B. Application to Defect Notification Actions
We come now to the application of these well-established principles to the showing required for summary judgment in a defect notification action. We are speaking of a context where, as here, it is undisputed that the failures pose an unreasonable risk of accidents, death, or injury.
In the case at hand, a careful review of the record leads us to the following conclusions: The Government, through 160 owner affidavits reporting 436 Wheel failures and the affidavit of a statistical expert projecting that the Government could have obtained 707 owner affidavits showing 1503 Wheel failures, clearly proffered evidence showing a significant number of failures in performance.
We interject that at trial the Government may well prevail on the ground e. g. that even substantial overloading in excess of gross vehicle weights (of 5500-6700 lbs.) is not outside the zone of ordinary abuse, in view of the 7500 lb. maximum shown on the GVW plate. See part C, below. But this depends on an issue of fact, and must be determined by the fact tribunal, and not by an appellate
The Government's supplemental memorandum, filed after argument on appeal, indicates a misunderstanding of the burden placed on a party seeking summary judgment. Appellee argues that the "record demonstrates that General Motors has not discharged the burden of proving owner abuse."
Finally, our view that GM has a case for trial does not import any view on how the case would come out if the record, as it now stands, were all that was put before the trial court. The aforementioned presumption that failures occurred under specified use or ordinary abuse serves to shift both the burden of producing evidence and the burden of persuasion to the manufacturer who must prove that the significant number of failures resulted from gross abuse. Consequently, even if GM were to present evidence setting forth instances of load levels substantially in excess of gross vehicle weights and testimony of manufacturing officials, like that in its affidavits, as to their inability to foresee such loading levels at the time the Wheels were offered as options on the Trucks, the trier of fact could conclude that GM failed to prove the overloading constituted gross abuse or find that the instances of gross abuse shown were not sufficient to overcome the presumption that the significant number of failures occurred under conditions of specified or ordinary abuse.
C. Factors Pertinent to GM's Gross Abuse Defense
The Government's motion and appeal papers attack GM's gross abuse defense as unsubstantial but, while its points may well have considerable force at trial, they do not conclusively show that there is no need for a trial. The Government's points relate to a cluster of factual issues bearing on what constitutes gross abuse under the facts of this case. 1. The first issue is what the Truck owners reasonably understood to constitute the specified loading limitation. GM contends that the "owner's manuals which accompanied these vehicles in 1960-65 adequately informed the owners of the load limits of the Kelsey-Hayes wheel."
The only charts in the manual containing data for 15" Wheels were tables headed "Tire Inflation Tables for Highway Service."
Reports contained in Part III of the Investigation Report and the affidavits submitted in support of the summary judgment motion reveal that a substantial portion of owners experiencing Wheel failures understood from the GVW plate that their Truck's GVW was 7500 lbs.
As to the use of Trucks with large cab-over campers, the Government points to information supplied to purchasers as indicating that such use was foreseeable. The Chevrolet brochure for the 1965 model year
2. Related to the dispute over the maximum load limits that owners should reasonably have understood as specified for their Trucks is the question of the amount of deviation from this figure which GM should have anticipated in designing the Wheel. During the administrative proceedings, a GM vice-president stated that the Wheel was designed to accommodate "a reasonable overload of 15 percent" and "a reasonable extra tire pressure" of about 15 lbs.
3. Another set of unresolved issues concerns the length and extent of "overloading" required to cause cracks in the Wheel capable of producing a failure at a later point under even subnormal loads. Both the Government and the District Court placed great emphasis on a GM statement that "a brief period of excess loading can cause a crack to occur in a wheel [which] . . . may develop to the point of wheel failure with further use of the truck."
The GM statements raise the issue whether there are separate problems of short-term peak overloading and sustained ordinary overloading. A higher, short-term margin of safety might be required of the manufacturer in view of the foreseeability of one or more brief periods of peak excessive loading during the lifetime of many of the Wheels.
The Government's motion for summary judgment was premised on the theory that a defect could be established by showing a large number of performance failures regardless of cause. Affidavits submitted by the Government supplied the large number of failures required to obtain judgment under its definition of defect. After carefully considering the language, purpose, history, and administrative interpretation of the Act, we have concluded that the District Court erred in accepting the Government's theory and foreclosing the possibility of an affirmative defense of gross abuse.
Our heft of the record leaves us with an understanding of the forces pressing the District Court to adopt the Government's interpretation of the statute. Here the Government had shown a large number of sudden and potentially catastrophic failures of a critical vehicle component. In addition, it put forth evidence suggesting that under the particular circumstances of this case there was a very wide range of reasonably foreseeable deviation from the manufacturer's calculations of gross vehicle weight, producing a high threshold to be hurdled by a manufacturer relying on an affirmative defense of gross abuse. And the manufacturer, after extensive and prolonged discovery, introduced no evidence of its own documenting vehicle overloading of a magnitude sufficient to raise a
Despite these emanations from the record, we cannot uphold the reasoning that the cause of performance failures is irrelevant to the determination of a defect. We find that a component is defective if it is subject to a significant number of failures in performance occurring on vehicles operated under conditions of specified use or reasonably foreseeable abuse or failure to maintain (ordinary abuse). As we noted in Parts II E and IV B of this opinion, the Government can make a prima facie showing by presenting evidence of a significant number of failures in performance unrelated to age or wear of the component. Such a showing places a burden on the manufacturer to prove that the failure resulted from gross owner abuse. Under this formulation of defect, we find that there are presently genuine issues of material fact concerning the manufacturer's affirmative defense based on gross and unforeseeable owner abuse.
That the current record is largely devoid of data on the loading histories of Trucks experiencing Wheel failures is regrettable, but understandable in view of the positions of the parties on the motion for summary judgment. The Government contended that the cause of failures was irrelevant and did not request owners submitting affidavits to include loading information. As we have noted, some of the owner affidavits reported loads which substantially exceeded the Truck's gross vehicle weight and are not palpably within the zone of ordinary abuse. At the same time, the affidavits suggest that many if not most owners experiencing failures and some dealers understood the specified load limitation to be 7500 lbs., the figure on the GVW plate affixed to the Trucks. Moreover, the affidavits reveal that many dealers assured purchasers that the Trucks equipped with the Wheels were adequate for large cab-over campers. GM made no attempt to document the extent of overloading vel non on Trucks experiencing failures, since it was preoccupied with defending against the Government's contention that the cause of failures was irrelevant, and with advancing its own theory that the Government was required to prove a large number of failures on plain trucks operated within specified conditions of use. The Government's own proof generated an issue through the not insignificant number of Government affidavits that showed overloading substantially in excess of gross vehicle weights.
We have concluded that summary judgment cannot be granted on the present state of the record. On remand the Government, if it be so advised, is free to amend its motion and offer additional evidence in an attempt to demonstrate that it is entitled to summary judgment.
The judgment is reversed and the case remanded for further proceedings not inconsistent with this opinion.
As of March 1, 1975, three other defect notification enforcement actions had been commenced. United States v. General Motors, No. 74-277, 65 F.R.D. 115 (D.D.C. 1974) (denying the Government's motion for summary judgment in a case involving steering pitman arm failures in 1959-60 model year Cadillacs); United States v. General Motors, No. 75-49 (D.D.C., filed Jan. 13, 1975) (involving quadrajet carburetors on 1965-66 model year Chevrolets and 1966 model year Buicks); United States v. General Motors, No. 75-50 (D.D.C., filed Jan. 13, 1975) (involving engine mounts on certain 1970 Cadillacs and certain 1965-68 Buicks).
This section was amended in 1970 and replaced in 1974 with new provisions governing defect notification and correction. See note 1 supra. The 1974 provisions retained the basic structure and approach of the 1966 section and expanded the obligations placed on manufacturers.
Amici curiae—Ralph Nader, Larry Joel Silverman, The Center for Auto Safety, and Physicians for Automobile Safety—submitted a brief statement in support of plaintiff's motion for summary judgment.
In its reply brief, GM disavows any attempt "to interpose common law negligence or products liability defenses." (at 5).
Although the hearings were held before the introduction of the defect notification amendments and the remarks cited were not directed specifically to the defect notification problem, we believe that the statements are indicative of the intended scope of the Act.
It is possible that the same component may contain a defect in performance relating to motor vehicle safety in one class of vehicle or use but not in another. For example, the reasonably foreseeable use and abuse of police cars is sufficiently different from the expected use of family owned cars that failures in police cars of a component common to both classes of vehicles might not signify a defect that would require notice to all owners.
It is open to the manufacturer to limit the scope of the defect finding by establishing that the failures in performance of a particular component are restricted to a specific, distinct type of use that differs from other types of vehicle operation. See discussion of NHTSA's treatment of failures of front suspension lower control arm of 1965-69 full-size Fords in Brief for Appellant at 37-38.
Other affidavits suggest that some Wheels failed under loads at or slightly in excess of the manufacturer's specifications. See, Affidavit of Millard Lee Clark (total weight of 5800 lbs., previously used without failures on ½ pickup truck); Affidavit of Clyde R. Polen (average load of 700 lbs. without driver and passengers; truck empty weighed approximately 4200 lbs.); Affidavit of John D. Murray (total weight of truck and camper 5600 lbs.); Affidavit of Gerald C. Anderson (truck equipped with 650 lbs. camper and 190 lbs. boat); Affidavit of Delbert E. Bales (camper weighs 1,080 loaded for trip); Affidavit of George P. Coulsting (present owner never loaded beyond 5500 lbs.; purchased used); Affidavit of Frank S. Humic (truck weighed twice with camper—5,220 lbs., 5,680 lbs.); Affidavit of Herman Laeder (truck used primarily as passenger vehicle; equipped with canopy cover and occasionally used to haul "light load of camping equipment.").