Litigation is a constant bane for industry, and the tire and automotive parts industries saw the usual complement of lawsuits filed, continued, settled or adjudicated in 2008.
The lawsuit that probably garnered the most publicity was that filed in March by the family of the late Robert A. Monk against Dill Air Controls Products L.L.C. and Discount Tire Co. Inc.
Mr. Monk was driving near Gainesville, Fla., in November 2007 when a tire failed on his vehicle, causing a fatal rollover crash. The plaintiffs attributed the tire failure to a faulty Dill TR413 tire valve stem, made for Dill by Topseal, a subsidiary of Chinese firm Shanghai Baolong Industries Co. Ltd.
The lawsuit reached a tentative settlement in early December, but details of its resolutionas is usual in such casesare confidential. Separately from the settlement, Dill announced in December it would recall up to 2 million valve stems (see story on page 3), several months after posting a consumer advisory about them on its Web site.
Another firm, Tech International Inc., announced a recall of Topseal valve stems in June, and Discount Tire has for some time offered to replace all valve stems free of charge for customers who bought tires between August 2006 and July 2007.
Other lawsuits during 2008 dealt mostly with business or labor-management disputes. One of the largest, between Continental Tire North America Inc. and the United Steelworkers (USW), was settled in April when Conti agreed to make payments totaling $158 million to a USW retiree health insurance fund.
In July, Les Schwab Tire Centers Inc. settled a lawsuit with the Equal Employment Opportunity Commission. The EEOC claimed that Earle Nevins, a Native American employee at the Les Schwab store in Kalispell, Mont., had suffered harassment and discrimination there, a charge Les Schwab denied both originally and in the settlement.
SmarTire Systems Inc., manufacturer of tire pressure monitoring systems (TPMS), obtained a settlement in February before the U.S. District Court before the Eastern District of Virginia. In the settlement, Continental Automotive Systems U.S. Inc.which was still Siemens VDO Automotive Corp. in September 2007 when SmarTire filed its lawsuitacknowledged the validity of SmarTire's TPMS patent.
SmarTire also settled a similar patent infringement case with Schrader-Bridgeport and Schrader Electronics Ltd. in August.
Class-action lawsuits continued to plague tire makers. In February, the U.S. Judicial Panel on Multidistrict Litigation granted Michelin North America Inc.'s motion to consolidate four class actions against Michelin and American Honda Motor Co. into a single action before the federal district court in Baltimore.
The four class actionsfiled in federal courts in Arizona, Florida, Illinois and New Yorksought injunctive relief and restitution on behalf of a projected class of motorists including owners of 2005-07 Acura RL and Honda Odyssey Touring minivan models equipped with Michelin's Pax run-flat tire/wheel system. The actions claimed the Pax systems wore out too quickly, were prohibitively expensive to replace or service and lacked sufficient repair facilities.
The nation's largest manufacturers of air, oil, fuel and transmission filters also found themselves facing multiple lawsuits charging them with a price-fixing conspiracy. Attorneys for 37 plaintiffsincluding quick-change oil businesses, auto repair shops and car and truck dealershipssought consolidation and class-action status for lawsuits filed in Connecticut, Illinois, New Jersey and Tennessee.