Manufacturing the Audi Scare

Mr. Huber, a columnist at Forbes magazine, is the author of "Liability: The Legal Revolution and its Consequences," (Basic Books, 1988).

THE WALL STREET JOURNAL MONDAY, DECEMBER 18,1989

If you're the kind of driver who sometimes has trouble finding the brakes in your car, you should be driving an Audi. Last month, in 35 mph crash tests of an airbage-quipped Audi 100, the mannequin in the driver's seat suffered the lowest crash force ever recorded by the National Highway and Traffic Safety Administration, NHTSA, in this kind of test.

And yet, according to the Center for Auto Safety--a self-styled public interest organization that sells its research to plaintiffs' lawyers--the Audi 100's predecessor, the Audi 5000, was as deadly as the Audi 100 is safe. It exhibited "sudden acceleration," a fatal propensity to take off at full speed even as the terrified driver rammed the brake pedal to the floor.

CBS's "60 Minutes" ran a devastating expose of the Audi 5000. Audi customers fled. Lawyers cashed in. The American public was saved, yet again, from the perils of technology gone awry. Only one little noticed footnote remains at the end: There was nothing wrong with the car.

The Audi story is by now, dismally familiar. "Sudden acceleration" accidents occurred when the transmission was shifted out of "park." The driver always insisted he was standing on the brake, but after the crash the brakes always worked perfectly. A disproportionate number of accidents involved drivers new to the vehicle. When an idiot-proof shift was installed so that a driver could not shift out of park if his foot was on the accelerator, reports of sudden acceleration plummeted.

But a story to the effect that cars accelerate when drivers step on the accelerator doesn't boost television ratings or jury verdicts. And driver error is understandably hard to accept for a mother whose errant foot killed her sixyearold son. So with the help of such mothers, CAS and CBS knitted together a tissue of conjecture, insinuation and calumny. The car's cruise control was at fault. Or maybe the electronic idle. Or perhaps the transmission.

"60 Minutes," in one of journalism's most shameful hours, gave air time in November 1986 to a self-styled expert who drilled a hole in an Audi transmission and pumped in air at high pressure. Viewers didn't see the drill or the pump—just the doctored car blasting off like a rocket.

Junk science of this kind moves fast. Real science takes time to catch up with this kind of intellectual cockroach and squash it. Government agencies in Japan and Canada, as well as in the U.S., conducted painstaking studies. The Canadians who are franker about such things, called it "driver error." In America, where we can't attach blame to anyone whose name doesn't end with Inc., it was called "pedal misapplication." And unsurprisingly, it's not just Audi drivers who commit it.

So, in the long run, the truth does come out. In the short run, the lawyers swoop in. Most soon recognized that they couldn't prove any defect in the Audi's engine or transmission. But our liability system today is a master of the bait and switch—the switch was to "pedal misdesign."

No doubt about it, the original Audi like other European cars, placed brake and accelerator pedals slightly closer together than is usual in many American designs. This allows the good driver to move faster between the pedals in high speed emergency. Perhaps it also makes it easier for the bad driver to mix up the pedals. Nobody, including NHTSA, is quite sure whether, overall, the old Audi pedal placement was marginally better or marginally worse. End of case? Hardly. With Audi shellshocked and vulnerable from the earlier junkengineering claims, the pedal placement lawyers moved in.

The "60 Minutes" story starred a mother who had run over her sixyearold son. On the air, she insisted that she had had her foot on the brake the whole time. When her $48 million claim came to court in Akron, Ohio, in June 1988 the investigating police officer and witnesses at the scene testified that after the accident the distraught mother had admitted that her foot had slipped off the brake. The jury found no defect in the car.

Trial judges in New Jersey and New York have overturned badpedaldesign verdicts against Audi. Last July a federal court in Pennsylvania issued a summary judgment for Audi. And that should have been the end of Audi's legal troubles.

Except that it wasn't. An appellate court reinstated the New Jersey verdict: an appeal is pending. The New York case was settled before retrial. A California jury returned a $3.5 million verdict against Audi on a pedalplacement theory, after the plaintiff's lawyers abandoned a sudden acceleration claim. Another appeal is pending. Today, Audi is reportedly defending itself in more than 140 different suits, and damage claims are in excess of $5 billion. Not that the aggregate claims have the slightest connection with reality, of course. At one point, a single demented plaintiff in New York filed identical $5 billion claims in both federal and state courts; both have since been thrown out.

How about the U.S. government safety report? In July, 1989, shortly after the report was released, Audi ran a hopeful advertisement titled "Case Closed." "The case is not closed," responded Robert Lisco, a Chicago plaintiffs' attorney. "Those guys must be smoking something." "60 Minutes" never even acknowledged the final U.S. findings, it did grudgingly note identical conclusions of an earlier, blue-ribbon study, and then proceeded to rebroadcast inflammatory videos from the earlier segment. CAS denounced the government study and cheerfully cranked up yet another sudden acceleration smear, this one against Cadillacs. Lawyers for the "Audi Victims Network" brazenly declared that the report strengthened their clients' cases.

They may be right. The largest suit now pending against Audi is an Illinois class action, ostensibly representing 300,000 or so Audi 5000 owners. The charge? That because of the sudden acceleration controversy, Audis have lost resale value.

Yes, sudden acceleration is real. A powerful engine kicks into gear without warning or reason. It crashes through a respected business, ruins the livelihood of hundreds of innocent dealers, and devalues the property of hundreds of thousands of bewildered car owners. The windfall goes to those who destroy and then successfully blame others for the wreckage. For heaven's sake, where are the brakes?