NEW ORLEANS (CN) – Ford Motor Co. can be sued for fraud in its settlement of an insurance claim with the family of an accident victim, the 5th Circuit ruled.
James Haffey was killed when his Ford Explorer with Firestone tires rolled over. Haffey’s family came to a settlement, which included a clause precluding any future suits against Ford.
However, the family came back two years later, alleging that Ford had made misrepresentations during discovery. The Haffeys rethought the settlement when the problems with Ford vehicles and Firestone tires were widely publicized in the early
The district court found that the Haffeys were not entitled to reopen the case because they did not void the settlement agreement and return the funds to Ford.
Judge Owen found that the law is unclear over whether a settlement must be voided before it can be challenged. She decided that Mississippi courts would treat a settlement as a contract. Therefore, she remanded the case to district court for further proceedings.