$96 Million Judgment In Texas Fraud Case
The following statement comes from the Rose Walker law
State District Judge Jerry Sandel of the 278th Judicial District
Court in Anderson, TX, has signed a $96 million judgment against
airplane engine manufacturer Textron Lycoming. The judgment results
from a legal battle involving a number of small airplane engine
failures that occurred when the airplanes' crankshafts broke in
The judgment, entered today, totals $96,039,498.33 and includes
$86,394,763.00 in punitive damages as well as awards for future
attorneys' fees and interest. In February, a jury in Grimes County,
Texas found Lycoming liable for fraud, ordered the company to pay
actual and punitive damages to Navasota, Texas-based Interstate
Southwest Ltd. and also found that the crankshaft failures in
question resulted solely from Lycoming's defective design.
That verdict came following a seven week-long trial. In
addition, the verdict effectively precluded Lycoming from pursuing
a $173 million indemnity claim against Interstate, which it had
previously filed in a Pennsylvania court.
"This judgment sends a clear signal that the original verdict
was sound," says Marty Rose, who represents Interstate Southwest.
"Our client has been vindicated. Between the judgment and its
impact on the indemnity claim -- we couldn't have hoped for a
Between 2000 and 2002, there were 24 small airplane engine
failures and 12 deaths in Cessnas, Pipers and other airplanes with
Lycoming aircraft engines. Interstate Southwest supplied Lycoming
with the crankshaft forgings for those engines.
Following those failures, Lycoming launched an investigation
aimed at determining the cause. Its conclusion was that Interstate
Southwest had overheated the forgings, weakening the steel.
But attorneys for Interstate, Rose and Hal Walker of Rose Walker
in Dallas, found a different cause. Their experts were able to
determine that Lycoming's design for the crankshafts, which dates
back to smaller, lower horsepower engines from 40 years ago, was
inadequate for the larger, higher horsepower engines that
They also found that by adding Vanadium to the steel --
something Lycoming decided to do just before the failures began --
the company further limited the amount of stress the crankshafts
could withstand. Lycoming had added Vanadium to make the steel
harder and reduce the number of machining operations, ultimately
saving the company money.
Ultimately, jurors agreed with lawyers for Interstate, and found
that even Lycoming's investigation of the crankshaft failures was
"The combination of poor design and Vanadium pushed these
crankshafts beyond their limits," says Hal Walker. "That's why
these planes crashed, and not, as Lycoming claimed, because
Interstate overheated the forgings."