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Highway guardrail maker defrauded US government of $175 million, jury finds

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Separate lawsuits allege that design change led to five deaths and multiple injuries

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A US company accused of selling highway guardrails that pose direct dangers to drivers has been found guilty of defrauding the federal government, the New York Times reports. A Texas jury determined Monday that the manufacturer, Trinity Industries, changed the design of its guardrails in 2005 without notifying the Federal Highway Administration. The company then sold its systems to state governments who then received federal reimbursement.

At issue is a decision to narrow the width of Trinity's rail head from five inches to four. State regulators have alleged that this change raises the risk of guardrails piercing cars (and passengers) during collisions. Plaintiffs in at least 14 other lawsuits claim that the changes to Trinity's guardrail design led to five deaths and several injuries. Internal company documents show that the change saved the company about $2 on every rail head, the part of the guardrail usually marked in black and yellow.

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Federal law requires companies to immediately notify the Federal Highway Administration of any design changes. Trinity maintains that the change does not pose any safety risks, and that its failure to disclose it was accidental. Four states — Missouri, Massachusetts, Nevada, and Virginia — have already banned Trinity's ET-Plus rail head due to safety concerns. The Federal Highway Administration has continued to approve the design and reviewed crash tests to determine they were eligible for federal reimbursement, though the Times reported this month that there were internal doubts about its safety. This month, the agency asked state governments to report crashes involving the ET-Plus. A spokesman said this week that the administration will evaluate the case to determine whether it affects the system's eligibility.

The jury this week awarded $175 million to Joshua Hartman, a Trinity Industries competitor who filed the lawsuit on behalf of the federal government under the False Claims Act. That sum will be tripled to $525 million, as stipulated under federal law, and will be shared between Hartman and the government. The judge hearing the case will determine any additional penalties against the company. Trinity says it will appeal the decision, adding, in a statement, that it "cannot and will not withstand legal scrutiny."