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Jim Guest President, Consumer Reports Comments on 9th Circuit Opinion in Suzuki v. Consumer Reports

    YONKERS, N.Y.--May 19, 2003--"We are encouraged that 12 prominent judges have agreed with the lower court decision that Consumers Union (CU) should have been granted summary judgment and that there is no evidence of malice in this case that would warrant a trial before a jury.
    "As Judge Kozinski, in a forceful dissent joined by 10 other judges, stated:

    'I find it incomprehensible that a review truthfully disclosing all this information could be deemed malicious under New York Times Co. v. Sullivan, 376 U.S. 254 (1964). If CU can be forced to go to trial after this thorough and candid disclosure of its methods, this is the death of consumer ratings: It will be impossible to issue a meaningful consumer review that a band of determined lawyers can't pick apart in front of a jury. The ultimate losers will be American consumers denied access to independent information about the safety and usefulness of products they buy with their hard-earned dollars. The majority sets a dangerous precedent, and the full court errs grievously by failing to take the case en banc to correct the error.'

    "We believe that this significant split, with 12 judges(a) supporting CU, warrants a review of these important First Amendment questions by the U.S. Supreme Court. We plan to file a petition for certiorari before the Supreme Court, and to seek a stay of the 9th Circuit's ruling."

    Consumers Union, the publisher of Consumer Reports, is an independent, nonprofit testing and information-gathering organization, serving only the consumer. We are a comprehensive source of unbiased advice about products and services, personal finance, health, nutrition, and other consumer concerns. Since 1936, our mission has been to test products, inform the public, and protect consumers. For online access to Consumer Reports, visit www.ConsumerReports.org.

(a) The 12th judge is Judge Ferguson, a Senior judge who wrote the
    dissenting opinion that supported CU in the previous three-judge
    panel decision. Senior judges do not vote on petitions for en banc
    rehearing.

    Background about Suzuki v. CU

    In Suzuki of Japan v. Consumers Union of U.S., Inc., CU has based its defense on the extensive factual record of its testing and publication. We believe the evidence demonstrates that our tests were conducted conscientiously, impartially, and fairly, and published our results in the spirit of the free press and free speech values of the U.S. and state constitutions.
    In May 2000, a U.S. District Court Judge told the Suzuki Motor Corporation of Japan that it did not have the evidence necessary to warrant putting Consumers Union of U.S. (CU), the nonprofit publisher of Consumer Reports, on trial over its 1988 test report on the Suzuki Samurai. In those tests more than a decade ago, Consumer Reports found that the sport-utility vehicle (SUV) had a "Not Acceptable" tendency to tip up and roll over during CU's emergency avoidance maneuver tests. Subsequent references to that testing were also at issue in the case.
    Federal Judge Alicemarie Stotler in the Central District of California (Orange County), the home county of Suzuki of America, granted CU's motion for summary judgment and dismissed all of Suzuki's claims. In her ruling, Judge Stotler held that CU's differences with the government over rollover testing were not evidence of wrongdoing because "...part of the First Amendment's protection has to do with disagreeing with the government." Judge Stotler concluded that "...a jury could not reasonably find that plaintiff proved its case by the quality and quantity of evidence required by governing law."
    "This legal battle is important," said CU President Jim Guest, "not only for Consumers Union and Consumer Reports, but for every American concerned about the rights of an unbiased organization to test products independently and to speak out in the interest of safer products. The First Amendment guarantees the right to report our independent findings, even when our judgment differs from that of the government or the company in question. The record of our testing of and publication about the Samurai demonstrates our high testing standards and the consistent concern in Consumer Reports for accuracy, fairness, and impartiality. Our product ratings are based on our test and survey results, and we make our judgments solely for the benefit of consumers."
    Although the trial court (Judge Stotler) granted CU's motion for summary judgment in Suzuki v. CU, a divided panel of the 9th Circuit Court of Appeals (2-1) reversed that decision in June 2002, with a strong dissent by Judge Warren Ferguson. CU asked the entire 9th Circuit for a rehearing of the panel decision, and that request for rehearing was denied on May 19, 2003, with a forceful dissenting opinion written by Judge Kozinski and joined by ten other 9th Circuit judges.
    In April 2000, a federal court jury in Los Angeles ruled in favor of CU in a similar suit filed by the Isuzu Motors Limited over a report that the 1995-96 Trooper was prone to roll over.
    Because of the important First Amendment concerns implicated, these cases have attracted significant media attention, including editorials in the Los Angeles Times and the Washington Post.

    Background about Consumers Union, SUV Handling, and NHTSA

    Since 1973, CU has used a double-lane-change emergency avoidance maneuver to evaluate the handling of all vehicles it tests, which it now refers to as the long-course avoidance maneuver. In the long course, a test vehicle is driven through a 240-foot-long course, marked with small pliable traffic cones, at progressively faster speeds until CU's engineers can establish the maximum speed at which it can navigate the course without hitting cones. This defines its handling limits. The vehicle is also rated on how stable, predictable, and forgiving it is.
    Because taller vehicles are inherently more prone to tipping up, CU also runs SUVs, minivans, and pickups through what is referred to as the short course to uncover any unusual handling problems. CU has run vehicles through the short course since 1988. This course's overall length is the same as the long course, but the cones are repositioned so that the vehicles are driven through a sharper series of turns. The speed at which a test vehicle completes the short course is not as important as what happens when it exceeds its handling limits. Typically, the vehicle will slide or skid sideways, knocking over cones. In most circumstances, this is a more controllable situation than a tip-up or rollover.
    CU has used both tests to evaluate the handling characteristics of SUVs, minivans, and pick-up trucks. Of the 136 vehicles (SUVs, minivans, and pick-up trucks) tested in the short course between 1988 and the June 2003 issue of Consumer Reports magazine, only three, the 1988 Suzuki Samurai, the 1995, 1996 Isuzu Trooper (and its twin the 1996 Acura SLX), and the 2001 Mitsubishi Montero Ltd., have been judged to display "Not Acceptable" emergency handling performance.
    Several other vehicles have been judged "Poor" in emergency handling performance. CU has been a proponent of safer motor-vehicle design since the 1930s. At that time, CU recommended larger auto windows to reduce blind spots, and bumpers and horns to reduce accident risk. Over the years, it has been an active force for improvements in auto safety. CU has tested and encouraged the use of seat belts, anti-lock brakes, and child-safety seats. It reports regularly on government and insurance industry crash test results, and has promoted the use of air bags while encouraging improved design of these safety devices.
    One major thrust of CU's current auto-safety activity is support for a government program to provide auto-buyers with information on comparative risks of rollover among various SUV models. In 1997, the U.S. National Highway Traffic and Safety Administration (NHTSA) granted CU's petition for the development of such a test. When granting the petition, NHTSA Administrator Ricardo Martinez, M.D., said that "Consumers Union has been a welcome partner that has focused the public's attention on rollover and provided a wealth of consumer information to the car-buying public." On May 25, 2000, NHTSA proposed a 5-star rating program based on a vehicle's Static Stability Factor (SSF). The program was intended to help consumers compare the relative rollover propensity of all vehicles. In January 2001, NHTSA finalized the SSF-based star-ratings program.
    After the Ford/Firestone hearings, Congress passed the Transportation Recall Enforcement, Accountability and Documentation (TREAD) Act signed by President Clinton in November 2000, and directed that NHTSA must also develop a dynamic test for assessing rollover propensity and provide that information to consumers. That program is to be completed by November 2002. Consumers Union has submitted comments to NHTSA on the agency's initial rulemaking.
    In February 2002, after nearly two years of study, the National Academy of Sciences (NAS) concluded that dynamic on-road testing of vehicles was a necessary addition to the current SSF system used by NHTSA to evaluate rollover propensity. The NAS report also stated the committee could not identify "any insurmountable engineering barriers to the development of a representative dynamic test (or tests) that would differentiate meaningfully among vehicles." Consumers Union engineers testified before the NAS in April 2001.
    In October 2002, NHTSA announced its initial proposal outlining new dynamic testing to evaluate a vehicle's rollover susceptibility. The suite of tests that NHTSA has announced is similar to ones Consumers Union has proposed. The new rollover information should be available to consumers later in 2003, NHTSA says.

    (Additional background available at www.consumersunion.org -- click on Product Safety, then SUV Rollover.)