Chrysler Told to Pay $262 Million in Safety Case

Chrysler Corp. was ordered Wednesday to pay $262.5 million to the parents of a 6-year-old boy who was killed when he was thrown from his family’s Chrysler minivan in a 1994 crash.

The verdict, the largest ever awarded against a car company in a safety case, found that Sergio Hernandez Jimenez II died because Chrysler knowingly manufactured minivans with a defective latch in the rear lift gate. The federal court jury deliberated for 2 1/2 hours before reaching its unanimous verdict in the monthlong trial in Charleston, S.C.

The jury awarded Jimenez’s family $12.5 million in compensatory damages and $250 million in punitive damages, the latter penalty coming in the wake of arguments by Jimenez’s lawyers that Chrysler attempted to enlist the aid of Congress in a scheme to block a federal investigation into the alleged defect.

Chrysler officials denied any wrongdoing and said they plan to file an appeal.

The accident that killed Jimenez on April 10, 1994, in North Charleston, S.C., “was a tragedy. But we do not believe the verdict in this trial was appropriate or that it was supported by the evidence,” the company said Wednesday in a statement.

“Sergio Jimenez was fatally injured when the driver of the vehicle that was carrying him ran a red light, causing a serious side-impact collision with enough force to cause the vehicle to roll over. Unfortunately, Sergio was not restrained by a safety belt or a child- safety seat,” the Chrysler statement said.

But David Dwares, one of the attorneys who represented the Jimenez family, said the problem was the latch, not the driving.

“The latch defect was egregious to the point where Chrysler knew for over 10 years that there was a severe problem,” Dwares said. “They embarked on a course of conduct to deny and cover up the defect. Hopefully this verdict will ring loud--that Chrysler covered up a defect,” Dwares said.

The cover-up allegation stemmed from Chrysler internal documents presented in court that seemed to portray a corporate campaign to encourage some members of Congress to block the National Highway Traffic Safety Administration’s investigation into the alleged minivan latch defect.

NHTSA closed its two-year investigation of the latch in October 1995 without finding it defective. But the agency allowed Chrysler to conduct an ongoing, voluntary “consumer service action” campaign in which it is attempting to replace all of the latches on its 1984-1995 minivans with stronger latches.

The voluntary fix was “the fastest, most practical way” to get latch replacements without going through the lengthy, expensive legal battles needed to force an auto maker to recall vehicles, NHTSA Administrator Ricardo Martinez said last week.

Chrysler, which steadfastly has maintained that the old latches are safe, so far has replaced the devices on 2.36 million of the 4.1 million minivans suspected of having faulty latches.

NHTSA estimates 37 passengers have been killed in accidents in which they were ejected when the rear lift gates of Chrysler minivans, including the Chrysler Town and Country, the Dodge Caravan and the Plymouth Voyager, popped open during crashes.

Chrysler officials said Wednesday that they are confident the verdict will be reversed, partly because the South Carolina District Court jury ignored what they called a central fact in the case. To wit: “Chrysler believes that the facts showed that the child was ejected from the side window of the vehicle, not through the lift-gate opening.”

Shares of Chrysler closed at $34, down $1.06, on the New York Stock Exchange.