Guardrail maker ordered to pay $663M in case that sparked safety concerns

A Texas court has ordered the manufacturer of a highway guardrail system to pay just over US$663 million in damages after a trial found the company had committed fraud.

The case had led to highway safety concerns across the U.S. and Canada.

In a final court order issued Tuesday, Trinity Industries was ordered to pay the damages to the U.S. government and a whistleblower, Joshua Harman, who is a Virginia guardrail installer.

Shortly after the order was delivered, a spokesman for the Dallas-based company said Trinity believed the trial court made “significant errors” which resulted in an “erroneous” judgment.

A Texas jury had found in October that the company had failed to tell regulators about design changes made to a guardrail system in 2005.

Guardrails are designed to crumple and absorb impact, but critics have said the cost-cutting design change made it more likely the guardrails would spear cars that crash into either end of the guardrail.

October’s jury verdict centred on the company’s failure to tell regulators about the changes, not whether the guardrails were safe.

In March, U.S. federal officials said the guardrail system met safety standards in crash tests, although Harman called their report a “whitewash.”

Harman will be recovering $218 million from Trinity as a result of Tuesday’s court order, in which a judge found the company had made 16,771 false claims to the government.

In Canada, several provinces stopped installing Trinity’s ET Plus guardrail system last fall and have been awaiting final crash-test results before deciding on further action.

None of the provinces have reported any specific issues with the system, but said they stopped installing it as a safety precaution.

In addition, the town of Stratford, Ont., launched a proposed $500-million class action against Trinity, alleging defects in the redesigned unit could cause guardrails to rip through cars and motorists instead of protecting them in crashes.

A number of states in the U.S. — including Texas — had also suspended new installations of the system.

Trinity’s ET Plus — the end unit of the guardrail — is supposed to absorb impact and guide the rail so a crashing vehicle isn’t slamming into the rigid steel end.

“We believe the evidence clearly shows that no fraud was committed,” company spokesman Jeff Eller said in a statement after Tuesday’s final court order was released. “The judgment is erroneous and should be reversed in its entirety.”