Toyota $1B+ Acceleration Class Action Settlement is Biggest in Auto History
December 27, 2012 11:25 AM
comment(s) - last by
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. (
) on Wednesday filed documents to settle
a major class action lawsuit
organized by Mr. Berman over
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.
[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
in the company's largest recall ever. Toyota was forced to also
temporarily suspend sales in 2010
Toyota's acceleration issues were eventually pinned on faulty floor mats
[Image Source: Today's Machining World]
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."
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. (
). 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
, and more recalls.
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RE: Public Perception
12/27/2012 4:31:54 PM
All you "expert drivers" would be the first ones to crash then throw a hissy fit over the fallout .
busy rush hour traffic after a long day, everybody on the road is tired and stressed to begin with.
some dumbass makes a left turn right in front of you at an intersection and you need to slow down or you WILL TBONE HIM.... Not your fault, but you need to slow down or you will crash.
Your car suddenly accellerates.
this highly common scenario combined with unpredictable acceleration is a death trap.... Whether its a computer chip or floormat... Result is the same.
RE: Public Perception
12/27/2012 4:57:55 PM
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
12/28/2012 9:45:20 AM
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.
"A politician stumbles over himself... Then they pick it out. They edit it. He runs the clip, and then he makes a funny face, and the whole audience has a Pavlovian response." -- Joe Scarborough on John Stewart over Jim Cramer
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