It’s Business, And It’s Personal

Guardrail maker vows appeal of fraud suit verdict and penalties

On Behalf of | Jun 23, 2015 | Business Litigation |

Legal assaults can come at a company from a lot of different angles. Last month, we wrote about how shareholders in a company that makes highway guardrails have raised claims of investor fraud.

Suits claim the firm failed to disclose that it was under federal investigation. The shareholders say they were denied material information that would have allowed them to better assess investment risk and they say they ended up losing money when word of the federal investigation became public.

But those are not the only legal issues this company is dealing with.

The firm is Trinity Industries Inc. It does business in North Carolina and a lot of other states providing guardrails that are supposed to help reduce the chance of serious injuries in motor vehicle accidents.

Some readers may be aware of news reports from last year that revealed the company is the focus of at least one personal injury suit. The claim in that case out is that the male victim of a crash lost both of his legs. He had run into a Trinity guardrail which he says should have collapsed and absorbed the impact. Instead, he says it impaled his vehicle and severed his legs.

Earlier this month, a federal judge in Texas ordered Trinity to pay $663 million. That’s because the company was found guilty of defrauding the U.S. government by selling a redesigned guardrail model. A Trinity competitor claims the new model isn’t safe and that Trinity didn’t tell government officials about the changes that had been made.

Trinity says it will appeal the decision and the penalties. But at the same time, it is named in more than 20 other personal injury claims from around the country stemming from guardrail-related accidents.

The competitor who brought the fraud suit on behalf of the government says he hopes the case leads to a recall of the product.