Airbag Maker Agrees to Largest Civil Penalty in NHTSA History, Prompting Recalls in Texas and Across the Nation

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Ammonium nitrate – that’s just a fancy name for fertilizer, right? Yes and no. While its ability to provide a source of nitrogen to plants has led to its widespread use by farmers who are looking to increase their crop yields, there is another, darker side to the odorless, crystal salt formed when ammonia and nitric acid mix.

If you do an internet search of the term “ammonium nitrate,” you will quickly discover that it has the potential to be a very dangerous substance. It is so dangerous, in fact, that the United States Department of Homeland Security has proposed a regulation aimed at preventing its misappropriation or its use in an act of terrorism.

So, why exactly would it be used by a manufacturer of airbags? That’s a very good question.

Consent Order Between NHTSA and Takata

According to a recent announcement from the National Highway Traffic Safety Administration (NHTSA), the Takata Corporation’s use of “phase-stabilized ammonium nitrate propellant” will result in the largest civil penalty ever for a violation of the federal Motor Vehicle Safety Act. Under a consent order between Takata and the federal government, the company will be subject to a total fine that could reach $200 million. The company will also be required to phase out its use of ammonium nitrate as a propellant.

The Takata Corporation is a Japanese company headquartered in Tokyo. Established in 1933, it has 58 plants in 21 countries and employs some 48,775 people. It began as a textile manufacturer making lifelines but branched out into vehicle safety equipment in the 1950s.

According to the NHTSA, Takata knew that it was making defective airbags, but it did not take appropriate measures to issue a recall in a timely fashion. Under federal law, Takata should have notified the NHTSA within five days of its discovery of the defect. Takata is also accused of providing “selective, incomplete, or inaccurate information” to the federal government and to its customers.

Largest Civil Penalty in Agency’s History

Under the terms of the agreement between the NHTSA and Takata, the company will pay $70 million in cash as a penalty, with the remaining $130 million in potential penalties tied to Takata’s future compliance in phasing out the defective inflator. All phase-stabilized ammonium nitrate inflators are to be phased out by the end of 2018. The agreement also requires that an independent monitor be appointed to oversee Takata’s performance of the terms of the consent order.

Because of the risks associated with the inflators, the NHTSA will use its authority to accelerate recall repairs to affected vehicles, something the agency has not done before. It is believed that the use of ammonium nitrate as a propellant in the inflators can cause explosive ruptures. As many as 100 injuries and seven fatalities have been linked to the defective inflators.

To Speak to an Experienced Texas Accident Attorney

If you have been involved in an east Texas automobile accident and believe that a defect in your automobile may have caused or worsened your injuries, you should speak to a knowledgeable product liability lawyer about your case. To schedule an appointment with the law firm of Earl Drott, call 903-531-9300 and ask for a free initial consultation.

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