Tire Maker Finds Itself
In a Legal Maelstrom

By MICHAEL OREY
Staff Reporter of THE WALL STREET JOURNAL

In the summer of 1999, two lawyers seeking to prove that a tire made by Cooper Tire & Rubber Co. was defective, and had caused a fatal car crash, concluded that the company would never willingly surrender information they wanted. So the pair descended on Tupelo, Miss., home to Cooper's biggest plant, and began chatting up former employees.

Gayla Kirby, an ex-tire builder, told the lawyers they could drop by her house, but she worried that her husband, also a former Cooper factory worker, wouldn't approve. Jack Kirby did greet the attorneys frostily. But then, suddenly, he said, "You want to know about tires?"

Lawyers Jerry Kelly and Paul Byrd received a tutorial that day on "awling," an obscure practice that resulted in some tires leaving the Cooper plant with small holes in their treads. The revelation opened a potentially powerful new line of attack for the suit the two lawyers had filed in 1998 and has prompted others suing Cooper to follow their lead. This month, lawyers began launching suits against Cooper in at least 20 states, seeking class-action status on behalf of millions of customers who allegedly bought awled tires.

Cooper says it discontinued awling in 1995. The company denies the process ever caused safety problems and says it has strong defenses in the case brought by Messrs. Byrd and Kelly.

In the normal course of events, that suit, known as the Hervey case, probably would have gone unnoticed. Defective-tire litigation, which has had mixed results, rarely received media attention. Cooper, based in Findlay, Ohio, sells only replacement tires and isn't a high-profile company.

But Cooper now finds itself in the center of a legal maelstrom. Bridgestone/Firestone Inc.'s recall in August of 6.5 million tires trained a spotlight on every big player in the $80 billion tire industry. The recall also has emboldened plaintiffs' lawyers to coordinate a broad legal assault against tire makers. While the magnitude of that attack isn't yet clear, Cooper's general counsel, Richard Teeple, compares it to those unleashed on the tobacco and health-care industries in the 1990s.

Already, tire makers are faltering in their effort to keep their records secret. On Sept. 27, a federal judge in Brunswick, Ga., ordered the unsealing of documents in a tread-separation suit Firestone had settled confidentially in 1999. Firestone has released some documents, including internal data on tires customers had returned to dealers, but the company has appealed the broad disclosure order. The same week, a Florida state-court judge presiding over a separate suit against the Bridgestone Corp. unit said the manufacturer would no longer be allowed to designate documents as secret unless it obtained approval from the court.

In the Hervey case, the lawyers' aggressive pursuit of ex-Cooper employees also let the attorneys assemble an unusually detailed picture of the nitty-gritty of tire production. Now set for trial in May, the case provides a road map for how tire makers defend themselves in court.

On May 15, 1998, Scharlotte Hervey and her family were headed from Little Rock to Phillips County, Ark., on the Mississippi border, to attend a relative's college graduation. The right rear tire on Ms. Hervey's maroon Volvo had run about 20,000 miles -- only half of its expected useful life.

But on a straight stretch of road about halfway between Little Rock and Memphis, most of the tread and upper steel belt on this tire suddenly peeled off. Ms. Hervey lost control, spinning across the grass median into oncoming traffic. A Dodge Stratus sedan plowed into the Volvo's passenger side at high speed, according to the police report.

The driver of the Dodge, Lane Whitaker, 23 years old, died at the scene. Ms. Hervey, 37, her husband and their 15-year-old son also were killed. Two other sons were left paraplegics.

In June 1998, Mr. Whitaker's father filed a claim against Cooper, with Mr. Kelly as his lawyer. Ms. Hervey's mother turned to Mr. Byrd to sue Cooper on behalf of her daughter's estate. The suits are now consolidated in U.S. District Court in Helena, Ark.

Cooper says that the cause of the accident wasn't a defective tire but Ms. Hervey's negligence. Tire makers typically defend against injury suits by saying tread detachment stems from customers' failure to maintain tires properly. The companies accuse consumers of driving with underinflated tires or failing to repair tires damaged by road hazards. Cooper seemed to have potent evidence of the latter: a puncture in the Hervey tire. The company further argued that Ms. Hervey, a junior-high-school secretary, should have been able to control her car after the tire failed -- an argument that plays well to some male jurors, plaintiffs' lawyers say.

From the start, Cooper battled Messrs. Byrd and Kelly about turning over the most basic information. The company initially refused even to concede that one of its tires was involved in Ms. Hervey's accident. Cooper "has just now been granted possession of the subject tire pursuant to a court order and has not yet inspected the subject tire, and thus has been unable to identify the accident tire as a Cooper tire," the company said in a Feb. 16, 1999, response to a fact-finding request made by the Hervey lawyers.

But Cooper had reason to know within days of the accident that it had made the tire. The company's legal department had sent an investigator to take photographs of Ms. Hervey's car, some showing the right rear tire labeled "Cooper Trendsetter II." Mr. Teeple, Cooper's general counsel, says the company's hesitancy to immediately acknowledge the tire as its own reflected other cases in which plaintiffs' attorneys had attempted to rely on false evidence.

Other tire makers have proved even less cooperative. In the past five years, at least six courts around the country have taken the unusual step of sanctioning Michelin North America Inc. for its conduct during pretrial fact finding. In September 1997, for example, G.R. Smith, a federal magistrate judge in Savannah, Ga., fined Michelin $25,000. The company, the judge wrote, "offered nothing but verbiage and a stone wall in response to plaintiffs' effort to obtain information essential to the prosecution of their case."

Michael Fanning, a spokesman for Michelin, a unit of France's Michelin Group, acknowledges that the company has been punished "a handful of times over many years." Michelin, he says, stands by "the positions taken to protect its trade-secret documents."

The fight between Cooper and the Hervey lawyers grew particularly heated over the company's "adjustment data." This is the vast trove of statistics that all tire makers maintain on tires under warranty that are returned by customers. When a tire is "adjusted," a dealer gives a customer full or partial credit toward the purchase of a replacement and records the problem with the tire, using codes provided by the manufacturer. Lawyers suing the industry want this information because they say it lets them plumb for patterns of defects.

But tire makers typically resist turning over adjustment data. In papers filed in the Hervey case, Cooper argued that its records are irrelevant in a product-liability suit because tire returns don't necessarily indicate defects. In a separate injury case against Cooper pending in the Georgia Supreme Court, the Rubber Manufacturers Association, an industry group, argued in a "friend of the court" brief in July that dealers often accept returns to please customers, not because of flawed merchandise.

At other times, however, tire executives have said they rely on adjustment data to flag quality problems. Robert Martin, who stepped down as Firestone's head of quality assurance in April, addressed the issue in a deposition in February in a tread-separation suit against that company in state court in Nueces County, Texas. What would happen, Mr. Martin was asked, if Firestone saw a large number of adjustment claims on tires made in a single plant. "We would monitor those and watch them, and we do," he responded. The suit was settled confidentially in September.

The Firestone debacle demonstrates that customer data can be revealing. Ford Motor Co. says that only when it persuaded Firestone to turn over another category of records, known as claims data, did the auto maker discern patterns of tread separation in certain Firestone tires mounted on Ford vehicles. Claims data track payments made by manufacturers to customers for minor injuries and damage caused by tire failure. A Firestone spokesman acknowledges that Ford's statistical analysis helped prompt Firestone's Aug. 9 recall.

In the Hervey case, Cooper eventually responded to a court order by handing over adjustment data on about one million tires similar to Ms. Hervey's. Messrs. Byrd and Kelly say this isn't a large enough sample to reveal the patterns they are seeking. Cooper, the No. 8-ranked tire maker, with $1.5 billion in global tire sales, makes roughly 40 million tires a year.

"We provide what we feel the other side is entitled to," says Mr. Teeple. "If the other side feels they are entitled to more, then they can seek the recourse of the court."

But by midsummer of last year, Mr. Byrd had wearied of skirmishing in court. He and Mr. Kelly, who work in the Little Rock area, decided to make the seven-hour round-trip drive to Tupelo. Since then, the pair, who stand to gain about one-third of any recovery but are paying their expenses, have made the car trip about 20 times.

Store Clerks and Hotel Maids

Cooper's vast, low-slung factory sits in the middle of the northeast Mississippi town, best known as the birthplace of Elvis Presley. Combing through court records and bantering with convenience-store clerks and hotel maids, Messrs. Byrd and Kelly gathered names of former employees of Cooper's plant. Unlike current workers, who generally need an employer's permission to talk to an opposing lawyer, ex-employees are free to provide information without a company counsel looking over their shoulder.

Jack Kirby, who left Cooper voluntarily in 1996, after working there for 11 years, gave the plaintiffs' duo their first potentially big break.

Mr. Kirby explained that at the end of the production process, tires sometimes have air blisters trapped between their innermost rubber layer and the layer of fabric just above it. To release the air in these blisters, he said, he and other Cooper workers would insert the point of an awl through the tread of the tire and into the blister. It was essential, he said, that the awl, a fine-pointed device about the length of a screwdriver, not poke all the way through the tire. Otherwise, when the tire was inflated, the air held in its cavity would leak out.

Martin Mahan, who worked for Cooper from 1971 to 1995, said in a deposition in March that he had worried that some fellow employees did awling incompetently. "I told my boss that this was going to bite us in the a" because awled tires later would leak air, he said. Mr. Mahan said he left the company for personal reasons unrelated to his job.

Cooper spokeswoman Pat Brown says that only "highly trained technicians" were authorized to awl tires. She says the procedure was performed on only about 1% to 2% of the tires made in the Tupelo plant. Most of the small holes were made on what is known as the shoulder of the tire, which is on its side, she says, but even awling through the tread shouldn't cause problems. Still, to be extra careful, Cooper discontinued the practice in 1995.

Cooper maintains that although Ms. Hervey's tire was made in 1992, the company's postaccident inspection of the tire revealed that it hadn't been awled.

In depositions earlier this year, former Cooper workers described additional alleged problems at the Tupelo plant. William Eaton, who left the company voluntarily in 1998, after 13 years there, said that unfinished tires, sticky to the touch, were sometimes placed on the factory floor. Some of these tires picked up dust and debris, including soda cans and work gloves, which could become embedded in tires during the heating and molding process. Mr. Mahan said he had seen such tires shipped out of the plant -- an allegation the company rejects as "absolutely false."

Cooper's lawyers got Messrs. Mahan and Eaton to acknowledge that they had put Cooper tires on their own cars. The company also has branded Mr. Mahan a "disgruntled former employee." He responds in an interview that he doesn't bear Cooper any ill will and considers it a "good company."

Company Response

Cooper officials vigorously defend the company's manufacturing and quality-control procedures and dispute the allegations made by its former employees. Although unfinished tires were placed on the floor, "the floor would have been swept and cleaned," says Mr. Teeple, so the tires wouldn't "pick up contamination that would cause tire failure."

Whatever former employees claim to have seen in Cooper's plant, says Mr. Teeple, "the tire itself is the best witness in the [Hervey] lawsuit." To tell the tire's story, Cooper shipped it off to James D. Gardner in Akron, Ohio.

Mr. Gardner may seem a surprising choice. Until last month, when he retired, the 56-year-old engineer headed product analysis for Firestone. A key part of his job was testifying for that company in product-liability cases. But, in an unusual arrangement, Mr. Gardner, who declined to be interviewed, also has moonlighted as an expert for Firestone's competitors.

Tread separation most commonly occurs, Mr. Gardner has testified, after a tire strikes a road hazard, like a rock, or is punctured by a sharp object. The damaged tire can then gradually lose air. If allowed to run underinflated, its steel belts can separate.

Plaintiffs' attorneys complain that Mr. Gardner typically can't say what exactly a tire has hit, or when. Still, the attorneys concede he is a knowledgeable, well-spoken witness.

Mr. Gardner said in a deposition in July that the cause of the Hervey tire's tread separation was a puncture through the tread into the tire cavity. The tread wasn't recovered from the accident scene, but he said he believed that the puncturing object remained in the tire until shortly before the crash. The object served as a plug, preventing the tire from going flat, he said. But the puncture nonetheless allowed air inside the tire to seep between its layers, leading to the tread separating.

The puncture wasn't caused by an awl, the industry expert maintained. If the tire had left the factory with an awl hole all the way through it, he said, "the tire would have been flat all the time."

Alan Milner, a product-failure analyst retained by the Hervey lawyers, disagreed. He took a variety of nails and screws and pushed them through the tread of a sample tire. X-ray analysis of the damage done by these objects, he said in a deposition in May, was different from the damage found on the Hervey tire. Mr. Milner's conclusion: The puncture was probably caused by an awl. The hole was so small that the tire could remain inflated, but it was big enough for moisture to enter through the tread, potentially leading to the deadly failure, he said.

Another issue shaping up as a classic battle of experts is whether Ms. Hervey should have maintained control of her car. If the case goes to trial, the plaintiffs' experts will assert that the difficulty of steering as the tire tread was separating inevitably threw Ms. Hervey's car into a dangerous spin.

But one of Cooper's experts, Christopher Shapley, said in his deposition in June that "99.9-something percent of people confronted with various forms of tire disablement simply pull over and change the tire." Ms. Hervey apparently panicked, the engineer asserted. "The requirement," he said, is "to stay calm."

Write to Michael Orey at michael.orey@wsj.com