Ford Motor Company Case Analysis

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Memorandum TO: Jonathan Foster, Head of the Legal Analytics Department FROM: Sawyer Folks, Business Analyst DATE: April 27, 2015 SUBJECT: Ford Motor Company Background The Ford Motor Company has had a rather tarnished legal history. Ford got into some hot water in the 1990s and 2000s over multiple safety scandals. One of these scandals occurred in 1996 and involved faulty ignition switches that would short and cause fires. The ignition switch scandal then led to Ford being sued by State Farm for neglecting to release information about the faulty ignition switches and their tendency to start fires. Perhaps the most famous Ford safety scandal of all took place during the 1970s when Ford released the Pinto. As a consequence of a poor design, the fuel tank was located near the cars bumper and had virtually zero protection mechanisms in place. This design flaw led to many fatal explosions from the car being struck from behind. Ford ended up having to pay millions of dollars in civil cases as a result of injuries and deaths related to the design of the Pinto. Ford had to fork over $125 million dollars in damages in just one civil case, although this was a special case. There were other cases in which Ford executives were found innocent of any murder charges at all. There was a very diverse and wide spectrum of cases related to the Pinto incident. Ford does not only suffer from legal issues related to a lack of safety, but also to legal issues involving environmental

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