ALL TERRAIN VEHICLE (ATV) LITIGATION

by John C. Cabaniss, J.D. and Philip C. Gaddy, J.D.

In the late 1960's, Honda sought to develop a product to compete with snowmobiles. Osamu Takeuchi purportedly led this development effort. The project culminated in the introduction in the United States for market year 1971 of the Honda U.S. 90 ATC (All Terrain Cycle). The ATC was characterized by its tricycle configuration, low inflation balloon tires and solid rear axle. During the 1970's the Honda ATC had a small sales market and no competition. Despite the limited market for the ATC, Honda learned of its hazards. By the late 1970's, Honda was receiving regular reports of ATC accidents through an early warning system it set up. In June, 1976, American Honda was informed by one of its sales representatives, Peter Cash, of the need to provide users with special training to operate ATV's.

Rising injuries were a consequence of rising sales. Honda claims that the ATC in the early years appealed only to off-road motorcycle enthusiasts. In the late 1970's, the recreational market for All Terrain Vehicles (ATV's) began to take off. The other major Japanese motorcycle manufacturers, recognizing he tremendous potential, moved quickly to enter the market. Yamaha, for instance, approached an outside company, Hodaka, and asked it to design a Honda ATC without infringing any of Honda's patents. This development work culminated in the production and sale of the Yamaha 125 in the United States for he market year 1980. This was followed by ATV market entrants from Kawasaki and Suzuki.

Information regarding ATV hazards continued to accumulate. In the early 1980's, two of Honda's team ATC racers were seriously injured in ATV accidents. Yamaha's test riders experienced numerous injuries while testing its ATV products, including an injury which occurred to a Japanese engineer, Mr. Shibita. Mr. Shibata was rendered a paraplegic in 1982 while test riding a 175 Trimoto.

In March of 1984, the Consumer Products Safety Commission (CPSC) notified the ATV manufacturers it had noted a dramatic rise in ATV related injuries. From 1982 to 1983 there was a 220 percent increase detected. An increase approaching 1,000 percent was noted from 1982 to 1984. The CPSC sought he manufacturers' cooperation in curbing this increase. Subsequently, congressional and CPSC investigations were launched into ATV safety. A subcommittee of the Committee on Government Operations, House of Representatives held a hearing on he CPSC's Response to ATV injuries on May 21, 1985. A report was issued by that committee on July 16, 1985. Among other things, the committee found:

Use of ATV's presents an unreasonable and imminent risk of death and serious injury. It recommended that the manufacturers immediately halt ATV sale and production; the manufacturers warn all ATV owners of the hazards; and the manufacturers should make training courses available to all ATV owners.

In September, 1986, the CPSC Task Force on ATV safety released its report and recommendations. It estimated here would be approximately 2.3 to 2.4 million ATV's in use it the end of 1986 and it noted there had been 559 ATV related deaths and 239,200 injuries. The report contains detailed analysis of the engineering aspects of ATV's and found, among other things, that seventy-four percent of three-wheeled ATV accidents involve tipping or overturning and that ATV handling is strongly influenced by its suspension system.

0n December 30, 1987, the United States Department of Justice filed suit against the ATV manufacturers alleging violations of the Consumer Product Safety Act. Concurrently, the government and the manufacturers entered into a consent decree resolving the safety issues raised by the government's lawsuit. The manufacturers agreed to the following: Although the consent decree was intended to resolve the ATY safety controversy, it failed because it did not require a recall of all three-wheeled ATV's. Thus, there are millions of three-wheeled ATV's still in use.

In litigation, plaintiffs' attorneys have attacked various aspects of ATV design and the manufacturers' conduct in the design, testing, marketing, and sale of ATV's. With respect to design, there are several glaring deficiencies. The geometric configuration of an ATV renders it prone to rollover during a turn and prone to flip-over while ascending a hill. The lack of a differential makes turning the ATV difficult and requires an operator to perform counter intuitive maneuvers in order to effect a turn. The geometric configuration of ATV's coupled with their weight distribution and lack of a differential render the vehicles prone to plow forward rather than turn under certain conditions.

Another major design deficiency for many ATV models is the lack of mechanical suspension. The manufacturers assert the low pressure balloon tires serve as safe suspension. Testing by the Consumer Products Safety Commission and consultants indicate reliance on the tires is misplaced and that they are not an effective suspension for off-road use. Essentially, these tires result in an inordinate amount of bouncing and hopping when riding on uneven terrain. The consequent lack of surface contact makes steering, at best, difficult even at low speeds. Various studies have concluded that handling characteristics could be vastly improved by the incorporation of front and rear suspension.

The manufacturers can also be criticized for failing to evaluate and incorporate a rollover protection system (ROPS) into ATV design. ROPS have been incorporated into a variety of vehicles such as farm tractors to successfully minimize injury risk.

Finally, manufacturers can be attacked for their marketing of ATV's. ATV sales were dramatically increased through an aggressive advertising campaign undertaken by the manufacturers beginning in the early 1980's. These advertising campaigns presented ATV's as safe, fun vehicles for the entire family. Riders are shown without helmets or other protective gear performing difficult and dangerous maneuvers. A marketing survey conducted by Yamaha in 1984 indicates its customers were of the opinion ATV's were safe, stable and easy to operate and its customers perceived ATV's to be safer than two-wheeled motorcycles.

The manufacturers' defense is user misuse. Typical claims of misuse are: going too fast for conditions; riding without a helmet; riding double; riding on pavement; drinking and driving and, in the case of children who have been injured or killed, inadequate parental supervision.

In evaluating whether or not a particular ATV case can be successfully pursued against an ATY manufacturer, one must closely scrutinize the causal relationship of the vehicle's defects to the particular accident and weigh that with the nature of the prospective client's conduct. Cases involving alcohol or drugs should be avoided.

Once you have decided to take a case a good degree of time and consideration should be devoted to the drafting of the complaint. The most obvious cause of action is for negligent design and manufacture of the ATV. The high center of gravity, short wheel base, inadequate suspension, lack of a rear differential and defects in the tires relating to damping, rebound and suspension, give rise to impossibly complex handling characteristics, inherent instability and propensities to roll and cap-size. Do not be misled - the control limits of the vehicle are easily exceeded even within the range of normal operating conditions. The three-wheel configuration gives rise to a safe, appealing appearance. Buyers, especially parents, are prone to view an ATV as a post-adolescent tricycle. Despite their appearances, these vehicles are extremely dangerous. Serious injury, even death, occur at moderate to speeds even under optimum riding conditions.

A claim for negligent or absolute failure to warn should also be considered. One should explore a client's knowledge of the vehicle's dangerous propensities. Ask what literature was provided to the client and what information was related by the ATV dealer. A number of experts have found inadequate the warnings provided by the ATV manufacturers.

The attorney should also explore any advertisements or promotional materials which were viewed by the client. Some of the manufacturers, as noted previously, have advertisements and promotional materials involving riders without helmets or other "appropriate safety gear." Other ads depict vehicles flying in the air, up and down hills, across rocks and through forests. This is evidence of the expected and intended use of the vehicles as manufactured. As such, this evidence provides the basis for claims of breach of implied warranty of merchantability and implied warranty of fitness for a particular purpose, pursuant to S55-2-315 and 316, N.M.S.A. (1978). In gathering the advertisements and promotional materials, be sure to ask for the out-takes, some of which show vehicles rolling over and capsizing. If nothing else, this is great evidence to present to a jury to rebut the manufacturer's defense of mis-use.

Finally, counsel should consider a claim under the Consumer Product Safety Act (CPSA). There is ample evidence that ATV's are defective and create a substantial product hazard as defined by the CPSA. Upon knowledge of such a hazard, a manufacturer is required to timely, properly and accurately inform the Consumer Product Safety Commission of the product's defects. Despite knowledge of the excessive number of injuries and deaths related to the operation of ATV's, the manufacturers failed to notify the commission or otherwise cooperate in the Commission's efforts to reduce injuries. A successful CPSA claim is awarded with attorney and expert fees. This will help defray some of the tremendous expense involved in this type of litigation.

There is some debate among the circuits, however, as to whether the CPSA provides for a private cause of action for reporting violations. In Drake v. Honeywell, Inc., 797 F.2d 603 (8th Cir. 1986), the Eighth Circuit found that the CPSA did not provide a private cause of action for violations of the statute. The CPSA, said the Eighth Circuit, provided a private cause of action only for violations of rules promulgated pursuant to the statute. The court concluded that Congress must have intended to withhold the private cause of action for damages or injury resulting from a violation of the statute itself. Since the reporting requirements in the rules were identical with a provision of the statute, the Court concluded that alleged reporting violations under the act were not actionable: Id. (The Court went on to find the report requirement rules to be interpretive, rather than substantive. The Court concluded that a cause of action cannot arise from interpretive rules since such rules merely provide guidance.)

Other courts have found to the contrary. The District Court in Butcher v. Robert Shaw Controls Co., 550 F. Supp. 692 (D.M.D. 1981), applying straightforward principles of statutory construction, found for a private right of action. Utilizing the same approach, Judge Burciaga allowed a CPSA claim in Jose Chairez, as personal representative of the Estate of David Chairez, deceased, v. Yamaha Motor Company, Ltd. (Yamaha Hatsudoki K.K.) a Japanese Corporation, and Yamaha Motor Corp., U.S.A. a California Corporation, DNM CV-87-0536. Judge Burciaga noted that:
Id.
This language, said Judge Burciaga, "plainly provides a violation of any rule in addition to Consumer Product Safety Rules, gives raise to a private cause of action". Id. (Emphasis in original). (It should be noted that Judge Burciaga granted Yamaha leave to apply for an interlocutory appeal of his decision and that application was thereafter denied by the Tenth Circuit.)

Once the complaint is filed it must, of course, be served upon the Defendants. A number of options are available. The safest route is service pursuant to Article 5 of the Hague Convention. This requires that the Complaint be translated into Japanese and sent to Japan for service on the Minister of Foreign Affairs. The Practical Handbook on the Operation of the Hague Convention of 15 November 1965 on the Service of Judicial and Extra Judicial Documents in Civil or Commercial Matters, (1983) describes how this may be accomplished.

Another route would be to effect service by direct mail pursuant to Article 10(a) of the Hague Convention. Article 10(a) of the Hague Convention provides for service of judicial documents by direct mail unless that method was specifically objected to by the signator country. The government of Japan did not object to subsection (a) of Article 10. See Chrysler Corp. v. General Motors Corp. and Toyota Motor Corp., 589 F.Supp 1182 (D.D.C. 1984); Ackerman v. Levine, 788 F.2d 830(2nd Cir. 1986). A Japanese translation is not required for service by mail pursuant to Article 10(a) of the convention. In Weight v. Kawasaki Heavy Industries, Ltd., 597 F.Supp 1086 ~.Y.A. 1984), the Court stated that "a Japanese translation is required only when service of process is transmitted through the central authority pursuant to Article S of the Convention....however, Article 10(a) of the Convention contains no such requirement for direct postal service."

Service might also be attempted by serving a local subsidiary. Although these latter two methods are certainly cheaper to accomplish they surely will result in a motion to dismiss for insufficiency of service of process and a delay in the case.

Once service is accomplished, a litigant can look forward to a long and difficult match. Although Honda has settled a number of cases recently, the general strategy of the manufacturers is to make the litigation as difficult as possible. A litigant can expect to confront every conceivable road-block and barrier on the road of discovery. One useful source of information is the document repository of the ATV Litigation Sub-group of the Association of Trial Lawyers of America. The repository is maintained in Birmingham, Alabama and can be searched upon acceptance to the group. Plan to spend a minimum of two days going through the documents.

Products such as the ATV certainly present a tremendous hazard which is not apparent to the average consumer. This is especially true with today's emphasis on extra-curricular, family activities. Although expensive and time consuming, ATV litigation is socially beneficial and can be personally rewarding. If you have or are contemplating filing an ATV case, the following references may be helpful.

REFERENCES:

Breen, K.C. (1986) An overview of the design and operation of ATV's, SAE Paper No.860226, SAE, Warrendale, PA 15096.

CPSC, (1986) Update of ATV deaths and injuries. U.S. Consumer Product Safety Commission, Washington, D.C. 20207 December 1985.

CPSC (1985a) Survey of all terrain vehicle related injuries- preliminary report. U.S. Consumer Product Safety Commission, Washington, D.C. 20207. December 1985.

CPSC (1985b) ATV Market Sketch. U.S. Consumer Product Safety Commission, Washington, D.C. 20207. December 1985.

Godding, R.D., S.K. Rockwell, S. Effken and M. Goding. (1984) Accident study of three wheel all terrain vehicles. ASAE Paper No.84-5037, ASAE, St. Joseph, MI 49085.

Liljedahl, J.B., W.M. Carleton, P.K. Tunquist and D.W. Smith. (1979) Tractors and their power units. John Wiley and Sons, New York, N.Y. 3rd edition.

McKibben, E.G. (1927) the kinematics and dynamics of the wheel type farm tractor. AGRICULTURAL ENGINEER-ING 8(1): 15-16; 8(2): 39-40,43; 8(3); 58-60; 8(4): 90-93; 8(5): 119-122; 8(6): 155-160; 8(7)187-189.

Sack, H.W. (1956) Longitudinal stability of tractors. AGRICULTURAL ENGINEERING 37(5): 328-333. SVA. (1985) Standard for all-terrain vehicles, America, Costa, Mesa, CL 92626. August 16, 1985 draft.

Tan, TE. (1984) Analysis of three-wheeled all terrain vehicle/rider system dynamics. Unpublished Ph.D. Dissertation, Iowa State University, Ames, IA.
Tan, T.E. and J.C. Huston. (1984(b) Three-wheeled ATV - A no- suspension rigid rider system, part 1: Modeling and parameter values. SAE Paper No.841058, SAE, Warrendale, PA 15096.

Tan, T.E. and J.C. Huston (1984b) Three-wheeled ATV - A no-suspension rigid rider system, part II: Applications-handling and ride. SAB Paper No.841059, SAE1 Warrendale, PA 15096.

Tan, T.E. and J.C. Huston. (1986a) a full-suspension three-wheeled ATY system: Part I-Modeling and parameter values. SAE Paper No.860227, SAE. Warrendale, PA 15096.

Tan, T.E. and J.C. Huston. (1986b) A full suspension three-wheeled ATV system: Part III-Roll, pitch and vertical motions. SAE Paper No.860228, SAE, Warrendale, PA 15096.

Weir, D.H. and J.W. Zellner. (1986) An introduction to the operational characteristics of all-terrain vehicles. SAE Paper No.860225, SAE, Warrendale, PA 15096.

Worthington, W.H. (1949) Evaluation of factors affecting the operating stability of wheel tractors. AGRICULTURAL ENGINEERING 30(3): 119-125 and 30(4)179-143.

Wright, R.R. and T.G. Carpenter. (1987) Lateral and Longitudinal stability of ATV's. (to be presented at the ASAE 1987 Summer meeting).



[The New Mexico Trial Lawyer 1989]