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Settlement will cover equipment installation, compensation for lost value

Steve W. Berman, Managing Partner at Hagens Berman, has achieved a key victory over what is expected to be the world's largest automaker in 2012.  

Toyota Motor Comp. (TYO:7203) on Wednesday filed documents to settle a major class action lawsuit organized by Mr. Berman over unintended acceleration in a variety of models.  The case was being held in U.S. District Court for the Central District of California, in Santa Ana, Calif.

Under the settlement terms [PDF], Toyota will set aside an estimated $1.2-1.4B USD, making the settlement agreement the biggest in automotive history, according to Mr. Berman's team.  The settlement fund will be used to compensate the owners of 3.25m Toyota vehicles for lost resale value.  The owners will also be eligible for free installation of a brake-override system.

After a fiery crash of a Lexus (Toyota's luxury brand) killed four in California in 2009, the National Highway Traffic Safety Administration (NHTSA) launched a formal investigation into acceleration issues.  While some suspected electrical origins for the issue, no such issue was ever replicated.  Ultimately the problems were blamed on faulty floor mats, which could entrap pedals on the Toyota vehicles, leaving drivers unable to brake.  Millions of vehicles were recalled in the company's largest recall ever.  Toyota was forced to also temporarily suspend sales in 2010.

Toyota Pedal
Toyota's acceleration issues were eventually pinned on faulty floor mats
[Image Source: Today's Machining World]

Mr. Berman praised Toyota's decision to settle the outstanding litigation and move ahead, commenting, "After two years of intense work, including deposing hundreds of engineers, poring over thousands of documents and examining millions of lines of software code, we are pleased that Toyota has agreed to a settlement that was both extraordinarily hard-fought and is exceptionally far-reaching."

Toyota chief North American legal officer -- Christopher P. Reynolds -- sought to take the opportunity to restate Toyota's point that its electronic systems were never proven to have issues, remarking, "This was a difficult decision -- especially since reliable scientific evidence and multiple independent evaluations have confirmed the safety of Toyota’s electronic throttle control systems."

Toyota vehicles
3.25 million vehicles are covered by the settlement. [Image Source: AP]

He adds, "[Ultimately] we concluded that turning the page on this legacy legal issue through the positive steps we are taking is in the best interests of the company, our employees, our dealers and, most of all, our customers."

Toyota certainly has enough resources to cover the settlement.  The company witnessed a rocky 2011 due to parts shortages from the tsunami and related domestic issues (see: Fukushima nuclear disaster).  But this year Toyota is expected to regain the sales crown, which was last year held by General Motors Comp. (GM).  Toyota is expected to announce sales rose 22 percent in 2012 to 9.7m vehicles, despite a Chinese boycott due to a territorial spat, more government fines, and more recalls.

Sources: Hagens Berman, Toyota [PDF], LA Times



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RE: Public Perception
By Souka on 12/27/2012 3:02:52 PM , Rating: 2
I never understood why the acceleration couldn't be stopped.

Woudln't any one of these do the job?
--> turn ingition off
--> put car into neutral
--> press brake pedal
--> press emergency brake

Yes I know some cars don't have a "key"..but any one of these should do the job right?


RE: Public Perception
By ChronoReverse on 12/27/2012 4:26:34 PM , Rating: 2
There was one incident where the guy allegedly with the runaway acceleration problem straight-out refused to shift into neutral despite being told over the phone by the emergency workers to do so.

Honestly, considering the first reaction would be to step on the brake (fewer people would consider the ignition first) the finding that most of the cases were just people jamming the acceleration by accident instead of the brakes makes sense.

Standing on the brakes would stop any modern car.


RE: Public Perception
By alpha754293 on 12/29/2012 11:28:07 AM , Rating: 2
People are dumb.


RE: Public Perception
By dsumanik on 12/27/12, Rating: 0
RE: Public Perception
By ChronoReverse on 12/27/2012 4:57:55 PM , Rating: 2
I'd have stepped on the brakes which are sufficient in all cars to stop a car at full acceleration.

Plus all the studies have shown that every single "sudden acceleration" case was due to stepping on the accelerator instead of brakes (except for the single case where a third party mat jammed it down - lucky I'm using factory mats).


RE: Public Perception
By conquistadorst on 12/28/2012 9:45:20 AM , Rating: 1
That's a great hypothetical what-if scenario but that doesn't appear to actual reality of what the issue was. It was neither the accelerator chip nor the floor mats. It was a few isolated cases of user error which happens everyday.

I'm not so upset about Toyota getting screwed as I am upset about the fact the "media" was able to successfully tar and feather a corporation based not only on hear-say but completely contradicted every fact and study that was brought to light. They piled on so much public disdain, applied enough public pressure to get them to settle this lawsuit, and worst of all - actually got away with all of it with no repercussion.

If this isn't a blatant case of libel, I don't know what is.


RE: Public Perception
By MartyLK on 12/28/2012 12:46:18 AM , Rating: 2
You need to take into account that the drivers were likely talking on their cellphone. From what I see these days, when a driver is talking on their cellphone, they refuse to be bothered with anything else, including paying attention to where they put their foot - on the accelerator or brake. They are so focused on their conversation that they don't even look around to notice their environment or circumstance.

They seem to figure that if there is an issue while they are on the phone, that has to be the fault of someone else.

Intentional cellphone talking while driving (ICTWD) could also explain why some of them follow the voice guidance of a GPS straight into a ditch or lake.


RE: Public Perception
By npolite on 12/28/2012 8:07:58 PM , Rating: 2
Turning the engine is generally not a good idea since you will lose power steering and power brakes. Unless you are under say 30 mph you shouldn't use this to stop a car.


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