General Motors Corporation v. Volpe

Citation321 F. Supp. 1112
Decision Date21 December 1970
Docket NumberCiv. A. No. 4004.
PartiesGENERAL MOTORS CORPORATION, a corporation of the State of Delaware, Plaintiff, v. John A. VOLPE, as Secretary of Transportation, the Department of Transportation, Douglas W. Toms, as Director of the National Highway Safety Bureau, the National Highway Safety Bureau, and the United States of America, Defendants.
CourtU.S. District Court — District of Delaware


Edmund N. Carpenter, II, Charles F. Richards, Jr., and David T. Dana, III, of Richards, Layton & Finger, Wilmington, Del., Frazer F. Hilder and Joseph Wackerman, General Motors Legal Dept., Detroit, Mich., Lloyd M. Cutler and William R. Perlik, of Wilmer, Cutler & Pickering, Washington, D. C., for plaintiff; Ross L. Malone, Gen. Counsel, General Motors Corp., Detroit, Mich., of counsel.

F. L. Peter Stone, U. S. Atty., Wilmington, Del., Frank Berndt, Office of the Chief Counsel, National Highway Safety Bureau, Dept. of Transportation, and Carl Goodman, Dept. of Justice, Washington, D. C., for defendants.

Arthur G. Connolly, Jr., of Connolly, Bove & Lodge, Wilmington, Del., Bruce L. Montgomery and Michael N. Sohn, of Arnold & Porter, Washington, D. C., for amici curiae, Ralph Nader, Larry Joel Silverman, The Center for Auto Safety, and Physicians for Automotive Safety.


CALEB M. WRIGHT, Chief Judge.

This case arises out of the General Motors Corporation's ("GM") efforts to obtain pre-enforcement judicial review of the National Highway Safety Bureau's ("NHSB") order of November 4, 1970, in which the NHSB directed GM to send a notification to the owners of certain pickup trucks stating that the wheels of the trucks contain a "defect which relates to motor vehicle safety" within the purview of the National Traffic and Motor Vehicle Safety Act of 1966 ("the Vehicle Safety Act" or "the Act") 15 U.S.C. §§ 1381 et seq., 1402(e). Because the defect notification provisions of the Act have survived these past four years untrammeled by judicial interpretation1 and because this case raises novel questions concerning judicial review of agency action, the Court's lengthy opinion must needs elaborate a good deal of background prior to discussing the issues raised by the present motions.


From the documents, pleadings, affidavits and briefs presented to the Court thus far in this litigation, the following narrative statement appears to be undisputed.

During the calendar years 1959 through 1965, the Chevrolet Motor Division and the GMC Truck & Coach Division of GM manufactured certain Chevrolet Series 20 and GMC Series 1500 pickup trucks hereinafter referred to simply as "the trucks" and offered them for sale during the model years 1960 through 1965.

Purchasers of the trucks were offered a variety of types of tires aside from the tubeless tire that was standard equipment. The selection of the tires and other optional equipment should be made on the basis of the purchaser's determination of the load-carrying capacity required for his intended uses of the truck. Among the tire options available during the model years in question were 15-inch, tube-type tires described as 7.00 × 15, 6-ply; 7.00 × 15, 8-ply; or 7.50 × 15, 8-ply. All of these 15-inch tires were mounted on 3-piece 15 × 5.50 wheels manufactured by the Kelsey-Hayes Company. During the model years in question GM sold approximately 200,000 trucks equipped with these wheels.

This case involves an alleged defect in the Kelsey-Hayes wheels. In general terms, GM has always contended that these wheels were suitable and safe for the normal or lower load-carrying capacities that it contends the purchasers of the trucks with Kelsey-Hayes wheels specified were acceptable to them. Had the purchasers intended to use the trucks for heavier loads, GM argues that the more expensive optional wheels and tires offered should have been purchased.

In September of 1966, Congress passed the National Traffic and Motor Vehicle Safety Act of 1966 for the avowed purpose of reducing "traffic accidents and deaths and injuries to persons resulting from traffic accidents." 15 U.S.C. § 1381. Impelled by the awesome destruction of human lives and property on the highways and concerned over serious allegations from many quarters that some automobiles presented serious hazards to safety,2 Congress authorized the Secretary of Transportation, among other things, to establish automobile safety standards and to determine that a vehicle does not meet the standards or that a vehicle contains a defect relating to motor vehicle safety and order the manufacturer of the vehicle to notify owners of the defect.

Since 1966 some standards have been set and a number of defects have been discovered both by manufacturers and by the NHSB, but this litigation represents the first time that a dispute has occurred between the NHSB and a manufacturer as to whether a vehicle contains a defect within the meaning of the Act.

By letter dated September 11, 1968, to GM, the NHSB initiated an investigation concerning the Kelsey-Hayes wheels that are the subject of this lawsuit.3 Thereafter both GM and the NHSB conducted a series of investigative studies and exchanged information concerning reports of wheel failures and analysis of the wheels themselves. The parties disagree as to the results of these investigations —GM contending that the evidence of actual wheel failures indicates that virtually all of them occurred under overload conditions and that the metallurigical analysis indicates no inherent defect in the wheels and the NHSB now contending that (whether or not most actual failures occurred under overload conditions) there is evidence both from wheel failures and metallurigical analysis to support the conclusion that there is an inherent defect in the wheels. In any event, Part I of the Investigation Report is dated April 2, 1969.

On April 21, 1969, GM advised the NHSB that although there was no defect and GM was not obliged to take any action under the Vehicle Safety Act, GM would send a letter to the truck owners to the effect that operation of the trucks in an overloaded condition with excess tire pressure might result in a safety hazard. The NHSB approved a final draft of this letter, and it was sent out on May 28, 1969.

During the summer of 1969, the NHSB sought to evaluate the effectiveness of the warning letter and otherwise continued its investigation. Part II of the Investigation Report is dated August 12, 1969, and by letter dated August 22, 1969, the Federal Highway Administrator (the departmental officer then charged with the responsibility for administering the Act) notified GM that, based on the investigations to date, it appeared that the wheels contained a "defect which relates to motor vehicle safety" and affording GM an opportunity to present its views on the matter. This is the procedure established by the Act, 15 U.S.C. § 1402(e).4 On September 11, 1969, by letter and on September 12, 1969, at a conference in Washington, D. C., GM presented its position that its evidence contradicted any finding of a defect and that the failures were a result of abuse of the vehicles from overloading.

Before the NHSB finally determined whether or not there was a defect, GM made a settlement offer. By letter dated October 3, 1969, GM proposed that the investigation be concluded on the basis of GM sending a second notification to owners of the trucks offering to replace, at GM's expense, the Kelsey-Hayes wheels on all of the trucks on which campers or other special bodies had been or would be installed.5 By letter dated October 8, 1969, the NHSB accepted GM's offer stating that it was in the public interest, but refusing to agree to GM's demand that the settlement would preclude the reopening of the investigation under the Act. The NHSB specifically reserved the right to take further action should the development of information on the wheels warrant it.6 As a result of the agreement, the NHSB terminated the § 1402(e) proceeding, and GM sent out the notification and replaced the wheels of those truck owners who accepted the GM offer.

The matter rested in this status until March 31, 1970, when the present amici curiae filed suit in the District of Columbia against Secretary Volpe and most of the other defendants here to compel them to reconsider the question of whether there was a defect in the Kelsey-Hayes wheels on trucks without the special bodies or campers.7 At a hearing on June 15, 1970, the NHSB apparently advised Judge Waddy that it was still investigating the matter. On June 26, 1970, Judge Waddy issued an Order finding that the plaintiffs (amici here) had standing to bring the suit and that the Court had jurisdiction to review the actions of the NHSB, and remanded the matter to the NHSB with orders to continue its investigation and report back to the court by September 17, 1970.8

By letter dated September 14, 1970, the NHSB informed GM that it had "initially determined that a defect which relates to motor vehicle safety" exists in the Kelsey-Hayes wheels on trucks not equipped with campers or other special bodies. Enclosed with the letter was Part III of the NHSB's Investigation Report dated September 3, 1970. The letter advised GM of its right under § 1402(e) to present its views on this question at a meeting on September 30, 1970. GM did so by a letter dated September 29, 1970, which was delivered to the NHSB at the September 30th meeting.9

After reviewing the evidence and statements before it, the NHSB, by letter from Director Toms (a defendant here) to GM dated November 4, 1970, notified it of its determination that the trucks in question contained a defect relating to motor vehicle safety by reason of the Kelsey-Hayes wheels being subject to sudden and catastrophic failure resulting in an unreasonable risk of accident, death and injuries to persons. Accordingly, he directed GM to send a defect...

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