Badly-needed legislation is pending in Congress dealing with the rental car industry. A long-standing threat to rental car customers from unrepaired defective cars — an issue that received virtually no attention until early this year — is now the focus of this important legislation. Consumer advocacy groups are supporting the legislation hoping to ensure the safety of millions of people who rent cars. A 2004 incident that led to the legislation involved sisters Raechel and Jacqueline Houck, who rented a Chrysler PT Cruiser from Enterprise Rent-A-Car in Santa Cruz. We wrote on that tragic incident in a previous issue of the Report.
The two young women were killed in a fiery crash caused by a defect in the rental car. Chrysler had recalled nearly 500,000 PT Cruisers a month earlier because of the defect — a design that could result in fire from a leakage of flammable power steering fluid onto hot engine surfaces or catalytic converters. But Enterprise ignored the recall and continued renting out the car. The sisters were the fourth customers to rent the car after the recall was announced.
The Houck family sued the rental car company, and in 2010, after nearly six years of stonewalling, Enterprise finally admitted in court that it was responsible for the sisters’ deaths. A jury awarded $15 million in damages to the parents. Although Enterprise’s actions were indefensible, it had broken no law because current statutes and regulations don’t require rental car companies to fix recalled vehicles. That should shock even my Tea Party friends!
In July, Sen. Charles Schumer introduced the “Raechel and Jacqueline Houck Safe Rental Car Act of 2011″ to ban rentals of recalled yet unrepaired vehicles. Sen. Schumer said that “millions of rental car customers and others who share the road with them may be at risk” without such a prohibition. The bill is co-sponsored by California Sens. Barbara Boxer and Dianne Feinstein and Connecticut Sen. Richard Blumenthal. Hopefully, there will be more co-sponsors in the Senate.
In addition to banning rentals of cars and trucks under safety-defect recalls until they are repaired, the bill prohibits sales of rental cars with uncorrected defects. Last year, rental car companies sold 1.4 million cars to auctions, wholesalers and consumers. The bill’s provisions would be enforced by the Federal Trade Commission and state Attorneys General. The bill would require the National Highway Traffic Safety Administration to carry out two studies and send the results to Congress. One study would address reports that rental companies have ordered new vehicles without side air bags or other safety features. Sen. Schumer says that consumers renting or subsequently buying such cars were never informed of that. The second study would determine whether rental car companies were selling cars that they knew were about to be recalled.
In opposing legislative proposals, the rental car industry has argued that its rentals of recalled vehicles before they are repaired are “infrequent.” It also argues that some safety defects are not so serious that they must be fixed immediately. It has called for a two-tier recall system that would provide leeway to delay some repairs. But even NHTSA has disputed the proposition that some fixes can wait. Any safety recalls resulting from a defect presents an unreasonable safety risk for persons driving or riding in a car under recall. NHTSA believes it is “inappropriate to suggest that some defects are not risky enough to require repair” and that “for the safety of the motoring public, all recalled vehicles should be fixed promptly.”
Based on its history, I am not at all surprised that the rental car industry is fighting proposals meant to ensure the safety of its customers. The industry did that successfully when California tried to pass legislation after the death of the Houck sisters. Without any doubt, this industry clearly puts profits over the safety of its customers. Carol Houck, the mother of the sisters killed in the 2004 crash and a strong proponent of the Schumer bill, believes the well-being of its customers is of less concern to the industry than money. She points out that “the industry’s business model clearly illustrates that profit trumps safety every time.” Hopefully, the badly-needed bill will make it through both the Senate and House and become law.
If you agree that this bill will improve highway safety, and is needed, contact your U.S. Senators and Representatives and ask for their help in bringing about passage. Also, if any of our readers need information on litigation against the rental car industry, contact Kendall Dunson, a lawyer in our Personal Injury/Products Liability Section, at 800-898-2034 or by email at Kendal.Dunson@beasleyallen.com.
Source: Los Angeles Times
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