Result: Settlement, $32,125,000
Santa Clara County Superior Court
June 3, 1986
Dennis Paboojian, age 47, was receiving instrument instruction in a Piper Malibu, a plane with which he was relatively unfamiliar. After takeoff from Palomar field in San Diego, California, the number three cylinder head separated from the engine and caused an engine compartment fire. The flight instructor, unaware of what caused the failure or the fire, took control of the plane. While he was troubleshooting the problem, the fire spread to the cockpit. Incapacitated by flames shortly thereafter, the instructor crashed the plane on the median strip of Interstate 405, adjacent to Long Beach International Airport.
The flight instructor died in the crash. Mr. Paboojian suffered full thickness burns over 62% of his body. He lost his left forearm, right hand, and most of his facial features including his nose and ears. He also suffered a fully separated diaphragm, an injury so rare that the survival rate is virtually unknown. He spent eight months in intensive care and endured more than 100 reconstructive surgeries.
Mr. Paboojian was CEO of Rolm Corporation, a technology company he grew into the billion-dollar revenue class before its sale to IBM. He left Rolm for a sabbatical shortly before the crash, making it difficult to prove what earnings he would lose as a result of his injuries. Mr. Paboojian turned to The O'Reilly Law Firm for representation.
The O'Reilly Law Firm conducted a lengthy investigation. The cylinders used in the Malibu engine were first used in much smaller engines. Teledyne Continental, the engine's manufacturer, progressively installed these cylinders on larger engines without conducting any additional stress engineering. The Malibu engine, designated the TSIO 520 BE, was the largest of Teledyne Continental engines to use these cylinders. Not surprisingly, cylinder heads began to crack on this model engine almost from the outset. By the time of the accident, Teledyne Continental was aware of more than 150 similar incidents.
Teledyne Continental assigned an engineer to determine the design safety factor for the engine after reports of cracking began to surface. The engineer determined the safety factor to be 1.14, well below the normal design safety factor of 1.50. In fact, it was later learned that the engineer miscalculated, and the actual safety factor was less than 1.0.
Teledyne Continental then hired a statistician to predict the likelihood of future failures in the fleet resulting from defective cylinders. Teledyne "lost" the statistician's report, however, shortly after Paboojian's crash. Although Teledyne Continental paid the statistician $60,000 for his work, the statistician had extreme difficulty recalling the report's conclusion when he testified. He conceded under cross-examination, however, that he had warned Teledyne Continental that future failures were likely.
Rather than replacing the cylinders on its fleet of TSIO 520 BE engines, Teledyne Continental issued a Service Bulletin, listing by serial number the suspect cylinders and requiring mechanics to inspect them at regular intervals for cracking. Unfortunately, Teledyne failed to include in the Service Bulletin the serial numbers of the cylinders installed in the accident aircraft.
Teledyne Continental's defense blamed the pilot for attempting to troubleshoot the problem rather than land immediately. Teledyne Continental further contended that the head cracked not because of a design defect, but because codefendant S&G Flight Services improperly reinstalled the plane's turbo charger after servicing, causing destructive vibration.
The O'Reilly Law Firm represented Paboojian in a personal injury suit against Teledyne Continental Motors. After four days of trial, the defendants settled for $31,150,000-then the largest aviation settlement ever awarded to a single plaintiff. After the accident, Piper grounded the entire Malibu fleet and discontinued installation of the TSIO 520 BE engine.