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GM Ordered to Pay $4.9 Billion in Crash Verdict

Liability: An L.A. jury awards record damages in blaming auto maker for a fire that burned six in a Chevy Malibu. Legal experts expect the amount will not withstand appeal.


A Los Angeles Superior Court jury on Friday ordered General Motors to pay a record $4.9 billion in damages to two women and four children who were trapped and burned when the gas tank of their 1979 Chevrolet Malibu exploded after a rear-end collision on Christmas Eve six years ago.

Legal experts said the verdict was the largest ever in a personal injury case. The staggering amount of the award is not considered likely to withstand an appeal.

"An award this size gives the tort system something of a lottery character," said USC Law School professor Gregory Keating. The high numbers reflect jurors' outrage at GM's conduct, he added.

Patricia Anderson, her four children and family friend Jo Tigner were awarded $107 million to compensate them for their pain, suffering and disfigurement. Jurors awarded $4.8 billion in punitive damages after finding that GM acted out of fraud or malice. The 12 jurors were swift and unanimous in rendering their verdicts after a 10-week trial that included emotional testimony from the burn victims, as well as an internal cost-benefit study that calculated the cost to the auto manufacturer of preventing fuel-fed fires. Attorneys alleged that GM chose not to spend $8.59 per car to correct the defect.

"GM has no regard for the people in their cars, and they should be held responsible for it," said jury foreman Coleman Thornton.

"General Motors failed to install a safe fuel system design that would have prevented 300 to 500 deaths a year," said attorney Brian Panish, who represented the burned children. "These victims here are the result of a corporate decision not to spend money for safer designs."

Richard Shapiro, one of GM's trial attorneys, said: "We're very disappointed. This was a very sympathetic case. The people who were injured were innocent in this matter. They were victims of a drunk driver."

He said he expects to file an appeal within two weeks.

The first step toward an appeal will come when the defense formally asks Superior Court Judge Ernest George Williams to reduce the award and set aside the verdict.

Ripples from the case were felt from the courthouse steps to Wall Street.

"How would you feel if your kids were in a burning car and you couldn't help them?" said a weeping Anderson, who was driving the group home from church when they were rear-ended at 89th Place and Figueroa Street by a car going 70 mph. In the back seat were her children Tyshon, now 6; Alisha, 11; Kiontra, 15; and Kionna, 15. All were trapped and burned.

On the witness stand, jurors were riveted as Anderson recounted her horror and frustration at hearing her children's screams as the vehicle filled with smoke and flames. But she was unable to reach them because the door handles were too hot to touch.

"I'll be dealing with this for the rest of my life," she said.

Her head and arms laced with ridges of scar tissue, 11-year-old Alisha Parker said in a soft, clear voice, "I'm not mad. I have no hard feelings." She lost the fingers on her right hand in the crash and fire.

In after-hours stock trading on Friday, GM shares fell $1.63 to $66.13 as traders reacted to the verdict.

The award was slightly more than 10 times California's previous record-setting verdict, also returned by a Los Angeles jury, in a 1994 insurance bad-faith case, said Todd Wolfe, president of an Oakland company that tracks verdicts in the state.

GM insisted Friday that the Chevy Malibu is safe. In a statement, the company expressed sympathy for the people injured in the accident, particularly the children. But it denied responsibility for those injuries, instead laying the blame on the allegedly drunk driver.

He was identified in news reports at the time as 28-year-old Daniel Moreno of Los Angeles and he was arrested on suspicion of felony drunk driving.

Spokesman Terry Rhadigan said Anderson's Chevrolet Malibu was stopped at an intersection when the other vehicle plowed into it from behind. The driver of the other car was legally drunk, with a blood alcohol content of 0.20, GM said.

Shapiro said the defense was not permitted to tell the jury that the other driver was allegedly drunk, nor was it able to present statistics that showed the Malibu's "outstanding safety record."

Law professors and other experts said they expect GM lawyers to achieve a substantial reduction of the award.

"The more dramatic a verdict, the more likely it is to be reduced by the trial judge or an appellate court," said Gary Schwartz, a UCLA law professor. He pointed out that an earlier case involving Ford Pinto gas tanks resulted in $125 million in punitive damages, which later was reduced to $3.5 million.

"Every time you hit that billion mark, it's going to raise a lot of eyebrows," said Alan Calnan, a professor at Southwestern University School of Law. The fact the punitive damages were 40 times the compensatory damages could signal the appellate courts that the amount was excessive, he added.

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