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Takata Refuses to Set Up Air Bag Settlement Fund

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In August 2014, General Motors set up an injury settlement fund to address claims of injury and death linked to the ignition switch defect. The company offered payouts for over 100 death claims and nearly 200 injury claims within a year.

U.S. Senator Richard Blumenthal (D-CT) recently suggested that Takata, manufacturer of the Takata air bags that have been linked to over eight deaths and over 100 injuries, set up a similar fund to address claims by victims who were injured or the families of those who were killed.

Though Takata recently offered a public apology for the defective air bags, they rejected the Congressman’s request.

Takata Rejects Settlement Fund Idea

In a July 7, 2015 letter to Congressman Blumenthal, Takata stated that they had already resolved “a number of claims involving airbag ruptures,” and that they intended to continue to “discuss settlement claims in appropriate cases going forward.”

The company did not agree, however, to set up any sort of settlement fund: “At the present time, given the limited number of claims filed and the MDL procedures in place that permit the efficient coordination of related claims, Takata believes that a national compensation fund is not currently required.”

They added that they would continue to consider the suggestion as events unfold.

Senator Disappointed in Takata’s Rejection of Settlement Fund Proposal

On July 10, 2015, Senator Blumenthal issued a statement following Takata’s rejection of the settlement fund proposal. In it, he expressed his disappointment, and his belief that the number of injuries and deaths associated with the air bags is likely to rise.

“Takata is apparently unwilling to acknowledge its responsibility for these tragic deaths and injuries,” he stated, “or do justice for victims and their loved ones.”

Takata Finally Expands Air Bag Recalls

Takata has been under pressure for over a year to expand their initial regional recalls, which focused solely on hot, humid areas of the country, such as Florida, Hawaii, and Puerto Rico, where most of the air bag accidents took place. Company tests showed that air bag inflators subjected to high heat and humidity were more likely to explode, sending shrapnel through the interior of the vehicle where the pieces could potentially injure and kill occupants.

Still, the National Highway Traffic Safety Administration (NHTSA) and other organizations believed the problem was more widespread, and encouraged Takata to expand their recalls in the fall of 2014. The company refused, forcing carmakers like Honda and Toyota to step in and pick up the slack.

Along with their public apology made in June 2015, Takata finally agreed to expand their air bag recalls to include all 50 states. There remain concerns about the replacement air bags, as some contain the same chemical propellant in the inflators that was used in the old air bags. Critics have stated that this chemical—ammonium nitrate—is unstable and an unwise choice for air bags. Fiat Chrysler has stated that they will no longer use Takata inflators because of this reason.

Nevertheless, the NHTSA encourages owners of vehicles affected by the air bag recalls to get their vehicles repaired at their earliest convenience.