Gentry v. Volkswagen of America, Inc.

• Decision Date: 30 June 1999
• Docket Number: No. A99A1184., No. A99A0810
• Citation: 238 Ga. App. 785,521 S.E.2d 13
• Parties: GENTRY et al. v. VOLKSWAGEN OF AMERICA, INC. et al. Volkswagen of America, Inc. et al. v. Gentry et al.
• Court: Georgia Court of Appeals

521 S.E.2d 13

238 Ga. App. 785

GENTRY et al. v. VOLKSWAGEN OF AMERICA, INC. et al.

Volkswagen of America, Inc. et al. v. Gentry et al.

Nos. A99A0810, A99A1184.

Court of Appeals of Georgia.

June 30, 1999.

Pope, McGlamry, Kilpatrick & Morrison, Charles N. Pope, Paul Kilpatrick, Jr., R. Timothy Morrison, William J. Cornwell, Wade H. Tomlinson III, Swift, Currie, McGhee & Hiers, W. Ray Persons, James E. Carter, Atlanta, for appellants.

Welch, Spell, Reemsnyder & Pless, Ronald D. Reemsnyder, Lisa K. Whitfield, Hezekiah Sistrunk, Jr., Atlanta, for appellees. BLACKBURN, Presiding Judge.

This is a product liability action. In Case No. A99A0810, Ralph Gentry and Sandra Gentry¹ appeal from the trial court's grant of partial summary judgment to Volkswagen² on the grounds that the National Traffic & Motor Vehicle Safety Act (the Safety Act) preempted the Gentrys' wrongful death claim for the death of their daughter Lori Gentry. In Case No. A99A1184, Volkswagen appeals, pursuant to interlocutory grant, the denial of its motion for summary judgment as to the Gentrys' claims of violations of the Racketeer Influenced & Corrupt Organizations Act (RICO). OCGA § 16-14-1 et seq.

On appeal of the grant of summary judgment, this Court applies a de novo review of the evidence to determine whether any question of material fact exists. Summary judgment is appropriate where the moving party can show that there is no genuine issue of material fact and that the movant is entitled to judgment as a matter of law. OCGA § 9-11-56(c). A defendant meets this burden by showing the court that the documents, affidavits, depositions and other evidence in the record reveal that there is no evidence sufficient to create a jury issue on at least one essential element of plaintiff's case.

(Citation and punctuation omitted.) Phelps v. BellSouth Advertising &c. Corp., 235 Ga. App. 147, 148, 508 S.E.2d 779 (1998). Additionally, this Court reviews de novo whether federal law preempts state law claims. See Irving v. Mazda Motor Corp., 136 F.3d 764 (11th Cir.1998).

Viewed in this light, the record shows that the Gentrys are the parents of Lori Gentry, who was killed in an automobile crash in 1989 while riding in a 1981 Volkswagen Rabbit. The 1981 Rabbit was equipped with a fully passive restraint system, which consisted of a passive (automatic) two-point shoulder belt harness, a ramped seat and a deformable knee bolster (the VWRA system). The Rabbit did not have a lap belt but used the ramped seat and deformable knee bolster to restrain the lower part of a passenger's body. The Gentrys brought suit asserting claims of strict liability in tort, negligence, wrongful breach of warranty, fraud, failure to warn, misrepresentation and concealment, wilful or wanton acts and RICO violations.

Case No. A99A0810

In Case No. A99A0810, the Gentrys appeal the trial court's determination that their common law claims are preempted by the Safety Act. The Gentrys assert that the specific design selected by Volkswagen for its fully passive restraint system (the VWRA system) was defective. Volkswagen argues that if the Gentrys are allowed to bring their state law claim, any liability would effectively eliminate the fully passive restraint system as a manufacturer's option under Motor Vehicle Safety Standard 208, thereby creating a conflict between the state law claim and the federal law.

1. State Law Claims.

An automobile manufacturer's compliance with federal regulations does not eliminate liability for design defects under Georgia law. Doyle v. Volkswagenwerk Aktiengesellschaft, 267 Ga. 574, 481 S.E.2d 518 (1997). Under the risk utility analysis applied to claims asserting design defects, compliance with applicable federal standards is simply one of the factors to consider. Id. at 577, 481 S.E.2d 518. Thus, Volkswagen's compliance with the requirements of the Safety Act does not bar the Gentrys from asserting a product liability claim under Georgia law. Whether that liability is preempted by federal law is the question on appeal.

2. Federal Preemption.

The Supremacy Clause of the United States' Constitution provides that the laws of the United States "shall be the supreme Law of the Land; ... any Thing in the Constitution or Laws of any State to the Contrary notwithstanding." U.S. Const. art. VI. Thus, state law that conflicts with federal law is "without effect." Cipollone v. Liggett Group, Inc., 505 U.S. 504, 516, 112 S.Ct. 2608, 2617, 120 L.Ed.2d 407 (1992). And, "common law liability may create a conflict with federal law, just as other types of state law can."

Whether federal statutes or regulations preempt state law is "a question of congressional intent." ... Congress— through federal laws and regulations—may effectively preempt state law in three ways: (1) express preemption; (2) field preemption (regulating the field so extensively that Congress clearly intends the subject area to be controlled only by federal law); and (3) implied (or conflict) preemption.

(Citations omitted.) Irving, supra at 767. See Macon-Bibb County Hosp. Auth. v. Nat. Treasury Employees Union, 265 Ga. 557, 558(2), 458 S.E.2d 95 (1995) (federal preemption of state law is "a question of Congressional intent").

Volkswagen argues only that the Gentrys' claims are impliedly preempted. Volkswagen's preemption argument is based on Motor Vehicle Safety Standard 208, which concerns occupant crash protection. When the 1981 Rabbit in which Gentry was riding was manufactured, Volkswagen was required to comply with one of three occupant protection options. 49 CFR § 571.208 S4.1.2.³ As amended in 1974, Standard 208 allows a manufacturer to use a fully passive restraint system, in lieu of the seat belt systems otherwise required, to meet the performance requirements of S4. See 39 Fed.Reg. 3834 ("Option two exists, in fact, to accommodate the introduction of passive restraint systems like Volkswagen's which cannot meet all requirements of option one."). Volkswagen contends that the VWRA system in the 1981 Rabbit complied with this second option, 49 CFR § 571.208 S4.1.2.2, as amended.

Assuming, without deciding, compliance with the federal standards, we turn to Volkswagen's implied preemption argument. We view this argument with the knowledge that "[w]hen considering implied preemption, no presumption exists against preemption." Irving, supra at 769. Volkswagen argues that the Safety Act impliedly preempts the Gentrys' claims because to allow the claims would frustrate the intent of the Safety Act.

"The focus of the Safety Act is to reduce deaths and injuries from automotive accidents by promoting and enhancing safer automobile design." Doyle, 267 Ga. at 577, 481 S.E.2d 518. Standard 208 "specifies performance requirements for protection of vehicle occupants in crashes," and its purpose is "to reduce the number of deaths of vehicle occupants, and the severity of injuries by specifying crashworthiness requirements." 49 CFR § 571.208 S1, S2. As noted above, manufacturers could choose from three restraint options to comply with Standard 208, and one of the options was a fully passive restraint system.

(a) Liability based on design of restraint.

The fully passive restraint option allows manufacturers to design any fully passive restraint system so long as it meets the minimum performance requirements set forth in the regulations. Standard 208 does not mandate any particular fully passive restraint system. Compare S4.1.2.1 and S4.1.2.3 (specifying a seat belt assembly). Holding a manufacturer liable where a fully passive restraint system failed to exceed this minimum standard does not create a conflict, but instead dovetails with congressional intent. Manufacturers are encouraged to design fully passive restraint systems which offer greater occupant protection. And, a manufacturer can meet both the minimum federal standard and the state tort standard by designing its restraint system to meet the latter. See Perry v. Mercedes Benz of North America, 957 F.2d 1257 (5th Cir.1992).

Volkswagen, by characterizing the Gentrys' claims as a "failure to have a lap belt" claim, contends the claims are preempted. We agree that, to the extent that the Gentrys allege as a design defect a failure to include a lap belt, that claim is preempted by federal law. Irving, supra; Doyle v. Volkswagenwerk Aktiengesellschaft, Case No. 1:91-CV-1926A, N.D. Ga. (slip op. Sept. 29, 1998). However, our review of the record finds Volkswagen's characterization of the claim overly simplistic. The Gentrys' claims assert more than a defect based solely on the lack of a lap belt.

The Gentrys assert that the specific design selected by Volkswagen for its fully passive restraint system (the VWRA system) was defective. The Gentrys' claims are similar to those asserted in Perry, supra. In that case, Perry alleged that the air bag system, which complied with federal standards, was defective because it was not designed to deploy in the type of crash sustained. The court found that "[I]t would not conflict with Congress' objectives and methods if [Mercedes Benz] were found liable in tort for failing to design its air bags to perform in a manner that effectively exceeds the federal minimum standards." Id. at 1264.

We likewise conclude that it would not conflict with congressional intent if Volkswagen were found liable in tort for failing to design a passive restraint system that exceeded federal standards.

(b) Liability based on choice of design option.

Volkswagen relies on two recent federal court decisions in which a state law claim was preempted by the Safety Act. Irving, supra; Doyle, supra at 1:91-CV-1926A, N.D. Ga. (slip op. Sept. 29, 1998). However, in each of these cases the claim was preempted because it eliminated an option granted to manufacturers under the Safety Act. Liability was based on the restraint option selected by the manufacturer, not the design of the option as we have in this...