Guardrail Maker Ordered to Pay $663M in Safety Scandal

— -- The maker of a controversial guardrail system used on roads across the U.S. was ordered today to pay $663 million in damages and penalties in return for committing fraud related to a decade-old modification to the guardrail system -- a change that accident victims claim has been responsible for gruesome amputations and deaths in some car crashes.

A Texas jury ruled against guardrail maker Trinity Highway Products, and its parent company Trinity Industries, back in October, after finding that Trinity made false statements to the government about a modification made to the end terminal of its ET-Plus guardrails back in 2005.

At the time, Trinity was ordered to pay $175 million, which was expected to triple by statutory mandate. Both sides were immediately ordered into mediation after the verdict but word came late last week that talks had broken down and the two sides had failed to negotiate a settlement. Today's ruling by Judge Rodney Gilstrap instructs Trinity to pay $525 million in damages as well as an additional $138 million in penalties -- $8,250 for each of the nearly 17,000 “false certifications” the company made.

The guardrail controversy, which was the subject of an ABC News “20/20” investigation last September, centered around the change in 2005 that involved Trinity trimming the width of a metal piece of the end terminal down from five inches to four. A company employee estimated at the time that the modification would save the company $50,000 per year. But Trinity failed to tell state or federal safety inspectors about the change until 2012, by which time the new guardrail end terminals had been installed on roads nationwide.

Accident victims and Josh Harman, a competitor of Trinity who brought the Texas lawsuit, claim that the guardrail modification can cause the end terminal to malfunction when a vehicle strikes it from the front. Rather than the guardrail ribboning out to absorb the impact as it’s designed, sometimes the guardrail locks in place, spearing straight through the vehicle and any occupants to happen to be in its way.

In today’s judgment, Harman was awarded 30 percent of the damages, amounting to around $200 million, and more than $16 million to cover legal fees. The rest of the money will go to the U.S. government.

Jeff Eller, a spokesperson for Trinity, maintained his company’s innocence in a statement to ABC News, indicating the company will challenge the judgment.

“We believe the evidence clearly shows that no fraud was committed,” he said. “Trinity also believes that the trial court made significant errors in applying the federal law to the plaintiff’s allegations and, therefore, the judgment is erroneous and should be reversed in its entirety."

Trinity maintains that its guardrails are safe and meet federal standards, and emphasized in its statement that the guardrail system passed crash new tests conducted in last December and in early January.