Bridgestone/Firestone North American Tire L.L.C. will pay somewhere in the neighborhood of $35 million to settle a nationwide class-action lawsuit regarding the company's recalled Firestone ATX, ATX II and Wilderness AT tires.
That amount will include $15.5 million for a three-year consumer education and awareness program; about $2,500 each for 45 named plaintiffs in the class action; and ``up to $19 million'' for the plaintiffs' attorneys who filed the action, a BFS spokesman told Tire Business.
In addition, if Judge Donald Floyd of the 172nd District Court in Beaumont approves the settlement, the Nashville, Tenn.-based tire maker will agree to manufacture ``certain tires'' with cap strips, nylon strips or comparable technology for the next seven years to improve high-speed performance, according to a July 24 BFS press release.
Although the BFS spokesman didn't have the exact list of Firestone tires to receive cap or nylon strips, he said it included 21 sizes of Wilderness tires, 19 sizes of Destination tires and ``four or five'' sizes of wide-track tires.
``They are mostly (sport-utility vehicle) tires but not all,'' he said. ``They include most sizes of Wilderness and Destination tires but not all.''
Zona Jones, an attorney with the Beaumont law firm of Provost & Umphrey, said the settlement ``reflects a victory for consumers, in that it creates a situation in which Firestone will make some design changes in the way they make their tires. That's the cornerstone of this settlement.''
Mr. Jones also said the settlement as written agrees to compensate the attorneys involved in the class action for fees and expenses at a level not to exceed $19 million.
He didn't know offhand how many lawyers were involved in the case, but said he believed approximately 25 separate law firms worked on it.
The consumer education program, meanwhile, will focus on tire inflation, tire use, tire maintenance, driving safety and automobile maintenance, according to the BFS press release. It will include a nationwide media campaign on tire safety and maintenance.
BFS said it denied all wrongdoing, ``but entered the settlement to avoid the burden and expense of protracted litigation.''
Bridgestone/Firestone first announced the settlement agreement May 23, but didn't discuss costs or details then because those still had to be worked out.
The class action in Beaumont was an offshoot of the nationwide class action in Indianapolis federal district court. The attorneys in that case sought financial compensation for alleged economic losses suffered by owners of Ford Explorers equipped with Firestone tires.
A judge in the Indianapolis court certified that class-action suit, but the Seventh Circuit Court of Appeals in Chicago overturned the certification in response to BFS' and Ford's petition. The two firms won a final victory last January when the U.S. Supreme Court refused to hear the case.
Plaintiffs' attorneys, however, made good on their threat to take the issue to the state courts, filing at least 13 separate actions. BFS prevailed in two of them, but then decided to settle the rest. Ford declined to be part of the settlement.
Judge Floyd has ordered BFS and the plaintiffs' attorneys to submit a plan for notification of class members by Aug. 25, according to Mr. Jones. The judge will review the plan, then schedule a hearing to determine whether the plan's details-including the compensation to plaintiffs' attorneys-are fair to all involved, he said.