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United States ex rel. Harman v. Trinity Indus.

United States Court of Appeals for the Fifth Circuit

September 29, 2017, Filed

No. 15-41172

Opinion

 [*647]  PATRICK E. HIGGINBOTHAM, Circuit Judge:

The trial in this case offers two narratives. One of a hardworking man who, angered by failures of guardrails installed across the United States—with sometimes devastating consequences—persuaded a Texas jury of a concealed cause of those failures. The other of the inventive genius of professors at Texas A&M's Transportation Institute, who, over many years of study and testing, developed patented systems including guardrails that, while saving countless lives, cannot protect from all collisions at all angles and all speeds by all vehicles—guardrails that have been installed throughout the United States with an approval from which the government has never wavered as it reimbursed states for the installation of a device integral to the system.

Despite a formal statement issued on the eve of trial from the government affirming that approval and a caution from this court that the case ought not proceed, seven jurors in a six-day trial in Marshall, Texas, found that the government had been defrauded. We will describe, but [**4]  not decide, the substantial challenges to the jury's findings of liability and damages as an essential backdrop to the challenge we ultimately sustain, one that ends this litigation. We hold that the finding of fraud cannot stand for want of the element of materiality. Therefore, we reverse and render judgment as a matter of law for Trinity.

Early highway guardrail systems helped prevent drivers from running off the road, attended by a lesser but significant risk—in a head-on collision with an automobile, the blunt ends of the guardrails could "spear" or penetrate vehicles' passenger compartments. Attempts to mitigate this risk by burying the end of the guardrail were successful, but created a different risk; guardrails ceased to spear automobiles, but proved to act as a launch ramp,  [*648]  rolling out-of-control vehicles, sometimes back into traffic. As part of its many years of ongoing research and testing aimed at improving highway safety, engineers at the Texas A&M Transportation Institute ("TTI") developed a guardrail "end terminal" system known as the ET-2000, which, with modification in 1999, became the ET-Plus.1 In a head-on collision, the ET-Plus' terminal (or extruder) head flattens [**5]  and extrudes the guardrail away from the vehicle while simultaneously "gating" the vehicle by the sequential failures of the pre-drilled posts carefully laced and spaced to meet design specifications for the system, all to slow speeding vehicles to survivable stops and substantially lessen the risk posed by the rails. Trinity Highway Products, LLC, a subsidiary of Trinity Industries, Inc. ("Trinity"), manufactures the ET-Plus system under an exclusive licensing agreement with Texas A&M University—in short, TTI engineers the product and Trinity manufactures it according to TTI's design. ET-Plus systems are sold to highway contractors and installed along many highways throughout the country.

The Federal Government subsidizes many state highway improvements, reimbursing states for the installation of guardrail end terminal systems meeting its standards. At times relevant here, acceptance by the Federal Highway Administration ("FHWA") was a prerequisite to eligibility for federal reimbursement. FHWA could require testing of products, unless they "are nearly certain to be safe" or "so similar to currently accepted features that there is little doubt that they would perform acceptably." [**6]  And changes to approved systems must also be submitted for approval unless an exercise of good engineering judgment finds they were not significant.2

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872 F.3d 645 *; 2017 U.S. App. LEXIS 18902 **; 2017 WL 4325279

UNITED STATES OF AMERICA, EX REL., JOSHUA HARMAN, Plaintiff - Appellee v. TRINITY INDUSTRIES INC.; TRINITY HIGHWAY PRODUCTS LLC, Defendants - Appellants

Subsequent History: US Supreme Court certiorari denied by United States ex rel. Harman v. Trinity Indus., 139 S. Ct. 784, 202 L. Ed. 2d 566, 2019 U.S. LEXIS 179 (U.S., Jan. 7, 2019)

Prior History:  [**1] Appeal from the United States District Court for the Eastern Division of Texas.

United States ex rel. Harman v. Trinity Indus., 2014 U.S. Dist. LEXIS 973 (E.D. Tex., Jan. 3, 2014)

CORE TERMS

tests, changes, highway, memorandum, crash, reimbursement, guardrail, eligible, modified, channel, argues, flared, terminal, installed, district court, false statement, allegations, disclose, damages, features, matter of law, transportation, engineers, drawing, government's decision, federal government, new trial, certification, manufacturing, disclosure

Civil Procedure, Appeals, Standards of Review, Abuse of Discretion, Judgments, Relief From Judgments, Motions for New Trials, Altering & Amending Judgments, Newly Discovered Evidence, De Novo Review, Trials, Judgment as Matter of Law, Postverdict Judgment, Remedies, Damages, Compensatory Damages, Governments, Federal Government, Claims By & Against