Porsche Carrera GT Crash Settled for $4.5M

[Wayne 962]

http://www.sportscarmarket.com/content/carrera

Last summer, "Legal Files" reported about a lawsuit resulting from the fatal crash of a Porsche Carrera GT at a club track day at the California Speedway (June 2006, p. 30). The lawsuit was recently settled for a reported total of approximately $4.5 million. The contributions to the settlement were about 49% from the estate of the driver, 41% from the track owners and the event organizers, 8% from Porsche, and 2% from the driver of the Ferrari that was claimed to have triggered the crash.

"Legal Files" received numerous comments from SCM readers, all of which were critical of the lawsuit, plaintiff, and attorney. No doubt, many readers may have the same reaction to the settlement. But let’s take a closer look at the facts.

To refresh our memory, Tracy Rudl filed the lawsuit alleging the wrongful death of her husband, Corey Rudl, who was a passenger in the CGT owned and driven by Ben Keaton at the Ferrari Owners Club track day. Rudl was represented by attorney Craig McClellan, a former racer and a successful plaintiffs’ attorney from San Diego. As the CGT was traveling at about 130 mph on the straightaway, a Ferrari entered the track at a relatively slow speed. Keaton swerved to avoid it and the Porsche skidded into a concrete barrier wall, killing both men. The wall had been placed closer to the track than its original position, in order to enlarge the area behind it for use as a children’s play area during an earlier NASCAR race.

Discovery creates clearer picture

Extensive investigation, interviewing of witnesses, and other forms of legal discovery brought out more facts. Here is the bigger picture, according to McClellan.

The Track. The track suffered from two major design defects—the pit-out (exit onto the track) design and the concrete wall along the straightaway that was moved to accommodate the NASCAR race. The problem with the pit-out design was that it brought the drivers onto the track in the middle of the straightaway and the pit-out driver’s view of the straightaway was completely blocked by a guardrail, so the driver had to rely entirely on the flagger when entering.

The aerial view of the track shows how the concrete wall that normally ran parallel to the track was moved to enlarge the area behind it. A second photo shows the Carrera GT crashed in the worst possible place—right where the wall protruded. It looks as the CGT would normally have hit the wall and bounced back toward the track. Whatever happened then would have been better than a 130-mile near head-on crash.

The Organizers. The Ferrari Owners Club requires that all cars pass a technical inspection by an approved repair facility. At a previous event, the FOC President and organizer had been warned by one of their vehicle certifiers that he believed that something was wrong with the handling of Keaton’s car and it should not be allowed to run. They let it into that event anyway, and it spun out three to four times—one time the event organizer was even on board and became nauseous. But he didn’t tell anyone about the warnings and did not exclude Keaton from that event. (As you will see below, it appears the concerns the mechanic had were related to the oversteer inherent in the design of the car, not to any particular mechanical defect.)

Keaton did not have the CGT inspected before this event, but was allowed to sign his own tech inspection form stating that the car was fine. Investigation revealed the FOC had never denied a participant access to a track day on account of a failure to pass tech.

The organizers also failed to enforce the track safety rule about cars entering the track. Pit-out was in the middle of the straightaway, with entry on the left side. But cars on the straightaway tended to stay to the left to set up for the right-hander at the end. To avoid collisions, cars entering the track were required to move to the right side as soon as possible. However, at this event, cars were entering the track and staying on the left side.

The Driver. Keaton was warned about the handling problems with the CGT, ignored his mechanic’s advice, and invited Rudl for a ride without mentioning the problems. And, when the Ferrari came onto the track slowly, he overreacted and spun.

The Ferrari Driver. The Ferrari driver and the flagger blamed each other for what happened, but it was concluded that the Ferrari entered the track too slowly, forcing Keaton to evade him.

Porsche. The sole claim against Porsche was that the CGT was defective because it was designed without electronic stability control, which Porsche calls PSM. McClellan deposed two German engineers on the subject, and their answers were inconsistent. One testified that Porsche did not think that its PSM system would work on the CGT because the car’s frame structure and suspension mountings would create strong vibrations that would interfere with its operation. The other engineer testified that PSM was not offered because the customers didn’t want it.

McClellan suspects it was a marketing decision, as the CGT was marketed as a "race car for the streets," and race cars don’t have electronic stability control. He notes that during its development, the CGT had exhibited a tendency to oversteer during high lateral acceleration. Porsche made some adjustments, but did not fully correct the problem, which explained why the mechanic who drove Keaton’s car reported “handling problems.” PSM would have corrected the “tail happy” oversteer response to Keaton’s steering input to avoid the Ferrari.

[Wayne 962]

continued...

What about the releases?

One of the primary matters addressed in the settlement negotiations was the release signed by Rudl. As all of us who have participated in a track day know, the release contained language that waived any claims against the organizers and participants, with Rudl assuming full risk of injury or death. Many SCM readers pointed out that the release should end the matter.

While the settlement was being negotiated, the California Supreme Court was considering a broadly similar case. The Court of Appeal had ruled that releases were effective as to negligence claims, but not as to claims of gross negligence. There was uncertainty about the outcome because this case was the first time this issue had been addressed by a California court. McClellan insisted that the Supreme Court would agree with the Court of Appeal, and that he could prove gross negligence against the various defendants. He also insisted that the release would not be effective against the driver, as Keaton had been warned about the car’s handling problems before the event and did not disclose them. Either way, the release had nothing to do with the claim against Porsche, as it was not a participant at the track day.

The Supreme Court’s opinion was issued shortly after the settlement and was what McClellan predicted. The case involved a release given by the parents of a developmentally disabled girl who participated in a City of Santa Barbara summer camp and drowned while swimming. With no prior California precedent, the Court looked to decisions from other states. Quite a number had addressed the issue, and the majority ruled that properly written releases would be effective against claims of ordinary negligence, but that public policy made them void as to claims of gross negligence. The Court noted that most of the handful of decisions that enforced releases in cases of gross negligence involved auto racing incidents, but also noted that several states had ruled that releases are ineffective against claims for ordinary negligence, even in auto racing situations.

Interestingly, the Court received amicus curiae briefs from a number of organizations, including NASCAR and the California Speedway Association, predicting the demise of spectator racing and numerous types of recreational activities if the Court adopted this rule. The Court brushed them off, pointing out that NASCAR holds three races each year in Virginia and New York, both of which have laws that bar releases even in cases of ordinary negligence.

Was anything accomplished?

A lot of money changed hands in this settlement, but did anything of lasting societal value get accomplished here? McClellan thinks a lot of good may have been accomplished. He points out that the California Speedway is now safer. The guardrail blocking the view from pit-out has been moved, and the track may move pit-out to the end of the straightaway. He is confident that the Ferrari Owners Club will institute better safety procedures at track days, and he is hopeful that Porsche and other manufacturers will never again build a supercar without electronic stability control. McClellan thinks that the manufacturers’ greatest exposure in this regard may not be crashes on racetracks, but what might happen on the street. Imagine a CGT driver who gets in over his head on a public road, the rear end comes around, and he spins into an oncoming car, killing its occupant. Faced with expert testimony that electronic stability control could have prevented the spin, what will the jury think?

McClellan points out that the typical SCM subscriber, a car enthusiast who holds fast cars and racetracks dear, will never make it onto this jury. The jurors will be more ordinary citizens. "Most people, especially those with children on the streets and highways, would fear a vehicle like the Carrera GT, with its tricky handling characteristics, 600-plus horsepower, and unskilled, unqualified drivers. When a 'race car for the streets' is sold to anyone with enough money, regardless of his ability to drive it, and it doesn’t even incorporate modern electronic safety devices that correct driver errors, then maybe the manufacturer should accept some responsibility for the foreseeable deaths that will result."

Tracy Rudl also believes that the lawsuit will benefit others. "My loving husband was an innocent passenger in an expensive sports car that inexplicably failed to incorporate a modern, life-saving safety feature. He was a passenger on a racetrack that was dangerously designed. While driving on racetracks always involves risks, the result of this case and the redesign of the track will help eliminate unnecessary risks and make the sport of high speed driving safer."

JOHN DRANEAS is an attorney and a car collector in Oregon. His comments are general in nature and are not intended to substitute for consultation with an attorney.

[Wayne 962]

McClellan points out that the typical SCM subscriber, a car enthusiast who holds fast cars and racetracks dear, will never make it onto this jury. The jurors will be more ordinary citizens. "Most people, especially those with children on the streets and highways, would fear a vehicle like the Carrera GT, with its tricky handling characteristics, 600-plus horsepower, and unskilled, unqualified drivers. When a 'race car for the streets' is sold to anyone with enough money, regardless of his ability to drive it, and it doesn’t even incorporate modern electronic safety devices that correct driver errors, then maybe the manufacturer should accept some responsibility for the foreseeable deaths that will result."

There's a part of me that agrees with this. The CGT has proven itself to be a difficult car to handle - even the STIG on Top Gear had a difficult time keeping it on the track properly (although when he finally did, the car beat the time of all other cars that came before it). I've seen countless photos of CGTs that have been crashed, or damaged, or ended up in ditches. Even if I had the $$$ to buy one, I think that I would probably stay away from it, as I'm not a good enough driver to warrant a car like that. I recently drove a 996 Twin Turbo, and I thought the same thing - the car was way too fast for normal roads, and I would probably "get into trouble" with it. The 959 is the same way, I'm very cautious with that car - you need to have a LOT of room in front of you when you mash the gas pedal on that thing...

-Wayne

[911teo]

Was anything accomplished?

A lot of money changed hands in this settlement, but did anything of lasting societal value get accomplished here? McClellan thinks a lot of good may have been accomplished. He points out that the California Speedway is now safer. The guardrail blocking the view from pit-out has been moved, and the track may move pit-out to the end of the straightaway. He is confident that the Ferrari Owners Club will institute better safety procedures at track days...

I think that this is the only good that came out of this case.... and also the jury put a lot of responsibility (44%) on this.

As a DE partecipant I have the most interest in these events being the safest possible for everybody.
Do I take a risk driving a the race track? Yes
Do I expect the track layout to be as safe as possible? Yes
Do I expect the marshalls to do their job properly? Yes

Maybe now special attention will be given by all track day organizations to possible obstacles around the race track. If these are not movable then maybe a breef will be issued and drivers will be made aware.

Maybe now tech inspection (even though it doesn't really matter in THIS particular case) will be required by a certified workshop.

And a lot of other things that could/will make our days safer at the track will be implemented.

The sad thing though here is that the above is only the marginal part of the story...

The big news is that Porsche was found guilty (even though only by 8%). It is incredible that this line of thinking was even accepted..

It's like saying that a gun manufacturer is responsible because the gun fired by an unexperienced individual killed someone by mistake.

The other point of interest to me is the fact that the jury held Mr Keaton as the major responsible party at 49%...
With this I have issues... if the waiver is void in case of gross misconduct (and for the track and Ferrari club u can say that) then Mr Keaton really didn't do anything that qualify as fgross misonduct.. he was driving fast on a race track...

So I don't really understand how/why the waiver does not work in his favor.

Mr Rudi signed the waiver and climbed on the CGT. He knew the risks he was going to be exposed to riding shotgun with someone he barely knew.

Again I can understand finding the track responsible, but I am appaled at Mr Keaton estate being the biggest contributor to the settlement.

[89911]

Nothing here surprises me. If I'm going to participate in what many would consider a foolhardy occupation and things turn out poorly, someone's going to pay for my errors. Every time I do a DE, I'm surprised they can get away with them with all the legal issues that could ensue. I would wager that in 5-10 years this is all going to end.

[chrisg252]

McClellan points out that the typical SCM subscriber, a car enthusiast who holds fast cars and racetracks dear, will never make it onto this jury. The jurors will be more ordinary citizens. "Most people, especially those with children on the streets and highways, would fear a vehicle like the Carrera GT, with its tricky handling characteristics, 600-plus horsepower, and unskilled, unqualified drivers. When a 'race car for the streets' is sold to anyone with enough money, regardless of his ability to drive it, and it doesn’t even incorporate modern electronic safety devices that correct driver errors, then maybe the manufacturer should accept some responsibility for the foreseeable deaths that will result."
This must give Porsche and other supercar manufacturers some pause. It seems obvious to me that just because one is a captain of industry, it doesn't follow that one has Allan McNish's abilities with a fast car. But the egos of some of those purchasers don't allow for that. Does this mean that in future that Porsche et al. will be installing PSM-like devices, and with whom does the legal liability of the PSM off switch lie?
Thanks, Wayne, for this post.

[plain fan]

Just think guys, had the litigation of today been around in the 50s our beloved vehicles (Porsches 356, 911/912/930/964/993) would have never made it into production. They would have been deemed unsafe by trial lawyers and juries and consequently never been built. Whatever happened to people understanding and respecting the capabilities and responsibility of the vehicle they drove?

[David]

One of my first reactions when I saw the pictures of the accident was why did the Ferrari club let them run without the roof panels. I wonder how much of the high speed handling was related to that.

I think it's unfortunate that such a large part of the settlement came from the driver. While a good deal of fault for the passenger's death may lie with the driver, I think an almost equal amount lies with the passenger for getting in the car.

As a racer, I'm glad the track was forced to take some responsibility. I'm amazed by some track layouts that are obviously dangerous (No Problem in Lousiana comes to mind). I raced there twice, but finally decided my life is worth more than a day at the track. I understand they made changes, but it's too late to win back this driver.

[jackb911]

As a retired claims manager for a major insurer, I think the award was reasonable and justified, maybe even on the low side after attorney's fees are deducted. But I also believe that Porsche's liability percentage should have been significantly higher than a paltry 8% of the award.

At Rennsport Reunion II, Hurley Haywood (I believe) was doing demonstration laps in a black CGT. It had obvious, serious oversteer issues in the hairpin. I was not impressed at all with what I saw. With that level of power in an evil handling (at the limit) chassis, and considering the target customer for that car, PSM really should have been standard.

After all, they put sunroofs in the '07 GT3's, so the "voice of the enthusiast" argument holds no water.

[Bench-Racing]

I remember a television special with Jay Leno and Hurley Hayward breaking records at Daytona with the CGT. Leno had a spin on the straight which was not unlike the oversteer problem outlined here. Supercars and driving fast take driving to "the edge". "The edge" is called "the edge" because there is no margin for error past this point, even if it was only 120-130mph. I have to agree that the driver has most of the responsibility in this situation and unfortunately he paid for it monetarily in addition to losing his life. We have all signed waivers without a second thought because if we didn't we were not going to be allowed to play. Nobody held a gun to the passengers head and I remember thinking, "if one of my friends had offered me the same ride I would have probably taken that opportunity". A sobering set of facts and a reality check for all. Thanks for posting this information.
Regards,
Charles

[onboost]

Originally Posted by 911teo

It's like saying that a gun manufacturer is responsible because the gun fired by an unexperienced individual killed someone by mistake.

That's just it... this is the angle that the law is argued from in many cases. There have been numerous cases recently where someone has been killed with a firearm and the family has gone after both the person who pulled the trigger and the gun manufacturer!! Though I've seen this primarily in cases involving kids.

On the other hand, look at the huge awards that have been levied against the Tobacco industry over the last few years. Did these manufacturer force these people to actually purchase and use their product? No, but the courts contend that their ads make it glamorous and acceptable.... uhhhh, but does it say that you must do this? Does Porsche or any other manufacturer say that you must drive fast?


P-

[shbop]

It's unfortunate that we're so inclined to look for a deep pocket. I guess "assumption of risk" is now always trumped by the "awareness of money." Too bad. Sometimes in life, there's just bad luck.

[jackb911]

Does Porsche or any other manufacturer say that you must drive fast?

No, but what do they think some people are going to do with a 612 HP car that goes 200 MPH?

[avendlerdp]

Originally Posted by plain fan

Just think guys, had the litigation of today been around in the 50s our beloved vehicles (Porsches 356, 911/912/930/964/993) would have never made it into production. They would have been deemed unsafe by trial lawyers and juries and consequently never been built. Whatever happened to people understanding and respecting the capabilities and responsibility of the vehicle they drove?

Actually if there had been the litigation of today back then there would have been seatbelts, non deadly dashboards, real brakes, tempered glass, airbags, and a lot of other safety items a lot sooner. Lots fewer dead people too, over the years.
If there was no danger of being sued one can only imagine the unsafe, toxic, crap we would be subjected to by companies trying to make a buck. People only hate lawyers until they need one.

As for the gun manufacturer metaphor... If you bought a gun that sent the bullet out the back one in 1000 times when an inexperienced shooter used it, you bet there would be a law suit. Lots of law suits....

[911teo]

Originally Posted by jackb911

No, but what do they think some people are going to do with a 612 HP car that goes 200 MPH?

But then why make it legal? Why sell cigarettes? Why let people buy guns? Why allow people to ski? Sky-dive? Bungee jump? Parachuting? Dive? Ride Horses?

All these activities involve a basic element of risk. The individual practising them should take responsibility for that.

If there is gross negligence I agree that a someone has to pay.

In this case I think that the lawsuit was important to establish that the Track and the Ferrari club did things that increased the risk embedded with the activity.

But blaming Porsche for the crash is absurd. The driver has to know their limits and the car's limit.

I am still on the fence about deciding wether the driver committed gross neglicence or if it was just a series of events that colluded tocreate an inevitable scenario.

Mr Rudi climbed into the car knowingly and assumed some risks. These risks were amplyfied by the track layout and the Ferrari driver.

Did Mr Keaton drive beyond his or the car's capabilities? I guess the jury decided he did (he was complaining abt the behaviour of the car) and hit him with the biggest pecuniary fine...

[onboost]

Originally Posted by jackb911

No, but what do they think some people are going to do with a 612 HP car that goes 200 MPH?

And this is fine too... but the question is should they be held accountable for that person doing so?

Sig Sauer makes great pistols.... you buy one and shoot you're next door neighbor.. should Sig be held accountable for your actions?

You're cutting a turkey at Thanksgiving, you've already had a bit too much to drink.. the knife slips and you cut the finger off of the kid who's family is visiting. Whose accountable....you, the knife manufacturer, the liquor store where you purchased the alcohol, the alcohol manufacturer or (D) all of the above?

Ok, yeah that sounds stupid right? You'd be surprised what passes through and gets litigated in our courts!

[ErVikingo]

onboost, you forgot butterball fro selling the turkey that required a knife to be cut up....

[Porsche-O-Phile]

Originally Posted by Original Article

Porsche. The sole claim against Porsche was that the CGT was defective because it was designed without electronic stability control, which Porsche calls PSM. McClellan deposed two German engineers on the subject, and their answers were inconsistent. One testified that Porsche did not think that its PSM system would work on the CGT because the car’s frame structure and suspension mountings would create strong vibrations that would interfere with its operation. The other engineer testified that PSM was not offered because the customers didn’t want it.

McClellan suspects it was a marketing decision, as the CGT was marketed as a "race car for the streets," and race cars don’t have electronic stability control. He notes that during its development, the CGT had exhibited a tendency to oversteer during high lateral acceleration. Porsche made some adjustments, but did not fully correct the problem, which explained why the mechanic who drove Keaton’s car reported “handling problems.” PSM would have corrected the “tail happy” oversteer response to Keaton’s steering input to avoid the Ferrari.

The big problem I see with this is that all the hand-wringing ninnies in government are going to point to this incident as a reason for making more electronic bullcrap in cars mandatory.

I hate to say this at risk of sounding like I'm trampling on a dead guy's grave, but it sounds like his next-of-kin is simply using the incident to fish for more money to support her high-roller lifestyle she no doubt became accustomed to by being married to a multi-millionaire. Pretty disgusting, IMHO.

[grudk]

Not surprising, really, but a sad day for car enthusiasts and everyone else IMO. Plenty of 'fault' to go around, perhaps, but lawsuits such as this could bring an end to DEs/club racing by raising costs. And that will mean more speed contests on the road, where we definitely DON'T need them

I believe the release should have settled it, absent some kind of malice.

For Porsche and other car manufacturers, it means the nanny electronics are mandated. Suspect that the days of the 'supercar' are numbered.

[mjshira]

Originally Posted by Wayne at Pelican Parts

There's a part of me that agrees with this. The CGT has proven itself to be a difficult car to handle - even the STIG on Top Gear had a difficult time keeping it on the track properly (although when he finally did, the car beat the time of all other cars that came before it). I've seen countless photos of CGTs that have been crashed, or damaged, or ended up in ditches. Even if I had the $$$ to buy one, I think that I would probably stay away from it, as I'm not a good enough driver to warrant a car like that. I recently drove a 996 Twin Turbo, and I thought the same thing - the car was way too fast for normal roads, and I would probably "get into trouble" with it. The 959 is the same way, I'm very cautious with that car - you need to have a LOT of room in front of you when you mash the gas pedal on that thing...

-Wayne

Didn't Leno spin his CGT also during a top speed run filmed for Rides? I think I saw Hayden (of Wevo) at that event also.

In my view, events with cars that can go this fast need to have greater controls else we all risk not having the ability to run our cars on a track in the future.