Bill targets corporate concealment of hidden product dangers

MARCH 21, 2001

Reggie James – 512-477-4431

Consumers Union Southwest Office

HB 3125 targets
corporate concealment of
hidden product dangers

HB 3125 (Rep. Bosse) imposes penalties
on companies that produce faulty products but do not disclose the harms to
the public. Following are examples of corporations charged with failing to
disclose important product information to their customers, often with dangerous

· Flammable Robes

Hanro USA sold robes nationwide between October 1998 and January 2000. Hanro
distributed the robes despite the company’s own flammability tests that
showed they were dangerous. Hanro recalled 1,200 robes and they are being
fined $150,000 for violating the Flammable Fabrics Act.

· Rezulin
(Diabetes) Drug Risks

Warner-Lambert Co. distributes a diabetes drug called Rezulin. The company
insists the drug does not cause liver damage even though their clinical trials
showed liver damage occurred almost four times more often with Rezulin than
with a placebo. There have been at least 383 lawsuits filed against Warner-Lambert
Co. The drug supposedly caused 391 deaths yet the company made more than $2
million dollars in drug sales. Warner-Lambert Co. is now owned by Pfizer Inc.

Motors’ Bad Brakes

Three law firms filed a class-action lawsuit against KIA Motors America. The
suit charges the company with producing 1998, 1999, and 2000 year Sephia models
that have defective brakes. Documents filed showed that KIA had been aware
of the defect for awhile.

· Faulty
Attic Furnaces in California

The Consumer Product Safety Commission and a New York Times investigation
showed that hundreds of thousands of California consumers owned faulty attic
furnaces that allegedly caused scores of fires in the state throughout the
last decade. Some residents chose not to disclose the fact that they had faulty
attic furnaces to people who bought their homes.

· Chrysler
Sued for Selling Lemons

Lawsuits filed against Chrysler Corporation claim the automaker failed to
disclose that the cars consumers bought had been bought back from other owners
because the vehicles had defects that could not be repaired after several
attempts. The N.Y. Court of appeals unsealed the Chrysler documents which
detailed Chrysler’s legal strategy over the resale of the defective vehicles.

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