Is car company suit for real?

It's being called a global warming suit against all the major carmakers. California Attorney General Bill Lockyer (his friends just call him Eliot Spitzer) said the federal suit is aimed at holding carmakers liable for all the harm that their vehicles have done to the environment and to the infrastructure. He's calling it a public nuisance - almost sounding like the tobacco lawsuits against Philip Morris. At 24/7 Wall St., Douglas A. McIntyre seems skeptical:

At first blush, it would appear that these claims would eventually be no more successful than the smokers suits were. The state had the power to set emissions standards or even to ban the sales of cars by manufacturers that built cars that did not fit criteria set by the state. Since the California legislature never took these steps, it will probably be difficult to claim monetary awards to offset the state's costs. It is also likely that the issue of whether the cars accounted for all of the health and structural damage would be equally difficult to prove. Factories and other sources can also be tagged for producing toxic gas.

And don't forget, Lockyer has a history of talking tough but not being able to follow through (oil companies, grocery chains). Still, this could be a very expensive case for the car companies, especially if other states join in. And if Lockyer actually wins? That would be the ballgame for at least one U.S. automaker. But that's a long way off.


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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
 
Mark Lacter, business writer and editor was 59
The multi-talented Mark Lacter
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