BILL ANALYSIS Ó
SENATE JUDICIARY COMMITTEE
Senator Hannah-Beth Jackson, Chair
2015-2016 Regular Session
AB 2387 (Mullin)
Version: June 15, 2016
Hearing Date: June 28, 2016
Fiscal: Yes
Urgency: No
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SUBJECT
Vehicle Equipment: Supplemental Restraint System Components and
Nonfunctional Airbags
DESCRIPTION
This bill would make it a misdemeanor to knowingly and
intentionally manufacture, import, install, reinstall,
distribute, sell, or offer for sale any device intended to
replace a motor vehicle supplemental restraint system component
if the device is a counterfeit supplemental restraint system
component, a nonfunctional airbag, or does not meet specified
federal safety requirements, or to knowingly and intentionally
sell, install, or reinstall any device that causes a vehicle's
diagnostic systems to fail to warn when the vehicle is equipped
with a counterfeit supplemental restraint system component or
nonfunctional airbag, or when no airbag is installed.
BACKGROUND
In October 2012, the National Highway Traffic Safety
Administration (NHTSA) issued a consumer safety advisory to
alert vehicle owners and repair professionals about the presence
and dangers of counterfeit air bags sold in the automotive
marketplace. That advisory stated:
NHTSA has become aware of a problem involving the sale of
counterfeit air bags for use as replacement parts in vehicles
that have been involved in a crash. While these air bags look
nearly identical to certified, original equipment
parts-including bearing the insignia and branding of major
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automakers - NHTSA testing showed consistent malfunctioning
ranging from non-deployment of the air bag to the expulsion of
metal shrapnel during deployment. NHTSA is not aware of any
deaths or injuries connected to counterfeit air bags. . . .
Consumers whose vehicles have been in a crash and had their
air bags replaced by a repair shop that is not part of a new
car dealership within the past three years or who have
purchased a replacement air bag online should contact the call
center that has been established by their auto manufacturer to
have their vehicle inspected at their own expense and their
air bag replaced if necessary. (NHTSA, Safety Advisory: NHTSA
Alerting Consumers to Dangers of Counterfeit Air Bags (Oct.
10, 2012) [as of June
11, 2016].)
Existing California law prohibits the sale of previously
deployed airbags, and prohibits tampering with vehicle computer
systems that detect whether an airbag is in proper working
order. This bill would recast these prohibitions and
additionally prohibit the manufacture, import, installation,
reinstallation, distribution, and sale of "counterfeit
supplemental restraint system components," defined as
replacement supplemental restraint system components that
display a mark identical or substantially similar to the genuine
mark of a motor vehicle manufacturer or a supplier of parts to
the manufacturer of a motor vehicle without authorization from
that manufacturer or supplier.
CHANGES TO EXISTING LAW
Existing law provides that an automotive repair dealer who
prepares a written estimate for repairs that includes
replacement of a deployed airbag that is part of an inflatable
restraint system, and who fails to restore the airbag that is
part of an inflatable restraint system to its original operating
condition, where the customer has paid for the replacement of
the deployed airbag as provided in the estimate, is guilty of a
misdemeanor punishable by a fine of $5,000 or by imprisonment in
a county jail for one year, or by both that fine and
imprisonment. (Bus. & Prof. Code Sec. 9884.76.)
Existing law states that a person who installs, reinstalls,
rewires, tampers with, alters, or modifies for compensation, a
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vehicle's computer system or supplemental restraint system,
including, but not limited to, the supplemental restraint
system's on-board system performance indicators, so that it
falsely indicates the supplemental restraint system is in proper
working order, or who knowingly distributes or sells a
previously deployed air bag or previously deployed air bag
component that will no longer meet the original equipment
manufacturing form or function for proper operation, is guilty
of a misdemeanor punishable by a fine of up to $5,000 or by
imprisonment in a county jail for up to one year, or by both the
fine and imprisonment. (Veh. Code Sec. 27317.)
This bill would strike the above provision and instead prohibit
a person from knowingly and intentionally manufacturing,
importing, installing, reinstalling, distributing, selling, or
offering for sale any device intended to replace a supplemental
restraint system component in any motor vehicle if the device is
a counterfeit supplemental restraint system component or a
nonfunctional airbag, or does not meet federal safety
requirements, as specified.
This bill would prohibit a person from knowingly and
intentionally selling, installing, or reinstalling in a vehicle,
any device that causes the vehicle's diagnostic systems to fail
to warn when the vehicle is equipped with a counterfeit
supplemental restraint system component or nonfunctional airbag,
or when no airbag is installed.
This bill would specify that a violation of the above provisions
is a misdemeanor punishable by a fine of up to $5,000 or by
imprisonment in a county jail for up to one year, or by both the
fine and imprisonment.
This bill would define, among other terms, "counterfeit
supplemental restraint system component" to mean a replacement
supplemental restraint system component, including, but not
limited to, an airbag that displays a mark identical or
substantially similar to the genuine mark of a motor vehicle
manufacturer or a supplier of parts to the manufacturer of a
motor vehicle without authorization from that manufacturer or
supplier, respectively.
This bill would define "nonfunctional airbag" to mean a
replacement airbag that meets any of the following criteria:
the airbag was previously deployed or damaged;
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the airbag has an electric fault that is detected by the
vehicle's airbag diagnostic systems when the installation
procedure is completed and the vehicle is returned to the
customer who requested the work to be performed or when
ownership is intended to be transferred;
the airbag is subject to specified prohibitions under federal
law; or
the airbag includes a part or object, including, but not
limited to, a supplemental restraint system component
installed in a motor vehicle to mislead the owner or operator
of the motor vehicle into believing that a functional airbag
has been installed.
This bill specifies that its provisions do not affect any
duties, rights, or remedies otherwise available at law.
COMMENT
1.Stated need for the bill
The author writes:
AB 2387 is a consumer protection measure. It strengthens
existing laws aimed at deterring the fraudulent distribution
and installation of counterfeit airbags by more clearly
defining key terms and increasing the penalty for knowingly
exposing the public to this potentially deadly hazard.
In 2011 California enacted SB 869 to address the problem of
airbag fraud. This was a well-intentioned attempt to protect
consumers from dangerous phony airbags that received the
near-unanimous support of the Legislature and that of auto
manufacturers and parts associations, auto safety proponents
and the insurance industry. Since its passage, however,
automakers have become aware of a growing problem involving
dangerous counterfeit and nonfunctional airbags that existing
law does not address.
Unlike counterfeiting other products, such as a handbag or
DVD, counterfeit airbags have the potential to kill. Testing
of these counterfeits by the National Highway Traffic Safety
Administration shows just how dangerous these products are.
AB 2387 prohibits a person from manufacturing, importing,
installing, reinstalling, selling, or offering for sale
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counterfeit airbag or a nonfunctional airbag. It also bans
the sale, installation or reinstallation of a device that
causes the vehicle's diagnostic system to inaccurately
indicate that the vehicle is equipped with a functional airbag
when a counterfeit or nonfunctional airbag or no airbag is
installed.
2.Protecting consumers from counterfeit goods
Existing law, the Consumer Legal Remedies Act (CLRA), generally
protects California consumers from merchants who sell
counterfeit goods in the marketplace. The CLRA prohibits
specified unfair methods of competition, acts or practices by
any person which either results in or is intended to result in
the sale or lease of goods or services to a consumer. (Civ.
Code Sec. 1770.) Existing law enumerates several methods of
unfair competition, acts, or practices, including passing off
goods or services as those of another, and misrepresenting the
source, sponsorship, approval, or certification of goods or
services. Any consumer who suffers damage as a result of these
prohibited practices may bring an action to recover damages, and
existing law allows for a class action suit to be filed on
behalf of a class of consumers adversely affected by an unfair
method of competition, act, or practice. (Civ. Code Secs. 1780,
1781.)
This bill would provide additional remedies for public
prosecutors to use in combatting the trade in counterfeit
airbags and airbag control systems. Specifically, individuals
who trade in counterfeit airbag components in violation of this
bill's provisions would be subject to both a $5,000 fine and
imprisonment of up to one year. Honda North America, writing in
support, states:
[AB 2387] addresses those who knowingly manufacture, sell and
install these products into the vehicles of unknowing
consumers. We believe that this bill will provide a real
disincentive to someone who would consider engaging in this
heinous act, and allow the state to pursue such actors. . . .
Existing California laws relating to airbag fraud do not
address this specific and growing problem, but are consistent
with the [L]egislature's original intent of protecting
consumers.
Importantly, this bill expressly states that its provisions do
not "affect any duties, rights, or remedies otherwise available
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at law," thereby preserving the ability of consumers to seek
redress under statutes such as the CLRA independent of actions
that may be brought by public prosecutors under this bill.
Support : Alliance of Automobile Manufacturers; Automobile Club
of Southern California; California Association of Highway
Patrolmen; California New Car Dealers Association; California
Professional Firefighters; Coalition Against Insurance Fraud;
Ford Motor Company; Global Automakers; Honda North America,
Inc.; Los Angeles County District Attorney; Peace Officers
Research Association of California
Opposition : None Known
HISTORY
Source : Author
Related Pending Legislation : None Known
Prior Legislation :
AB 1854 (Brownley, Ch. 97, Stats. 2012) made it a misdemeanor to
install, reinstall, rewire, tamper with, alter, or modify a
vehicle's computer system or supplemental restraint system so
that it falsely indicates the supplemental restraint system is
in proper working order, and to knowingly distribute or sell a
previously deployed air bag or component that will no longer
meet the original equipment manufacturing form or function for
proper operation.
SB 869 (Yee, Ch. 430, Stats. 2011) provides that an automotive
repair dealer who prepares a written estimate for repairs that
includes replacement of a deployed airbag, and who fails to
restore the airbag to its original operating condition, is
guilty of a misdemeanor punishable by a fine of $5,000 or by
imprisonment for one year, or by both fine and imprisonment.
SB 427 (McLeod, 2009) would have increased from $1,000 to $5,000
the penalty under the Automotive Repair Act for an automotive
repair dealer who prepares a written estimate for repairs that
includes replacement of a deployed airbag and who fails to
repair and fully restore the airbag to original operating
conditions. This bill was vetoed by Governor Schwarzenegger.
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AB 1471 (Havice, Ch. 449, Stats. 1999) prohibited the knowing
installation, reinstallation, distribution, or sale of a
previously deployed, and made a violation of this prohibition a
misdemeanor.
Prior Vote :
Assembly Floor (Ayes 78, Noes 0)
Assembly Appropriations Committee (Ayes 19, Noes 0)
Assembly Privacy and Consumer Protection Committee (Ayes 11,
Noes 0)
Assembly Public Safety Committee (Ayes 7, Noes 0)
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