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Varela v. FCA US, LLC - 5/5/2020

Arizona Court of Appeals Division One holds that a tort claim based on a carmaker’s failure to install automatic emergency braking technology is not preempted by the federal government’s decision not to mandate that technology.

A mother sued three automobile corporations after a vehicle rear-ended her car at high speed, killing her daughter.  The vehicle that caused the collision was not equipped with automatic emergency braking (“AEB”) technology, although AEB was standard on higher trim-levels.  The mother argued that, if the vehicle had been equipped with AEB technology, it would not have collided with her car or would have collided with less force.  The superior court granted the corporations’ motion to dismiss based on implied obstacle preemption.  The mother appealed.  The Court of Appeals reversed.

The automakers argued that the mother’s tort claims were preempted by the National Highway Transportation Safety Administration (NHTSA)’s rejection of a consumer group’s petition to initiate rulemaking to mandate AEB in new cars.  But under Sprietsma v. Mercury Marine, 537 U.S. 51 (2002), a federal agency’s decision to refrain from mandating a national standard does not, without more, impliedly preempt a state common-law tort action.  And here, NHTSA’s denial of the petition did not indicate an intent to preempt tort claims based on the absence of AEB or otherwise reject AEB.  Rather, NHTSA strongly endorsed AEB but stated that rulemaking was unnecessary because automakers were already making huge strides in developing and installing AEB, spurred in part by NHTSA’s own performance criteria for AEB.  The Court also noted that higher-end trim levels of the vehicle that caused the collision were automatically equipped with an AEB system that met NHTSA’s performance criteria.  Thus, the jury would not be asked to set a performance standard for AEB technologies.  Instead, the jury would be asked to decide whether, after effectively winning NHTSA’s approval for its AEB design, the carmaker acted negligently and created a design defect by failing to make that design standard on all models.  The Court concluded that federal law did not preempt that claim.

Judge Johnsen delivered the opinion of the court; Judges Thumma and Howe joined.

Posted by: Josh Bendor

Posted On: 5/18/2020