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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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Public Perception
By ChronoReverse on 12/27/2012 12:01:31 PM , Rating: 5
It's seems downright ridiculous that despite nobody being able to prove that Toyota made a real mistake, the company will still have to suffer through the financial loss as well as the even more important public perception hit.




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.


RE: Public Perception
By Solandri on 12/28/2012 1:58:45 PM , Rating: 2
quote:
It's seems downright ridiculous that despite nobody being able to prove that Toyota made a real mistake, the company will still have to suffer through the financial loss as well as the even more important public perception hit.

It's a problem with our legal system. The standard for civic trials is a preponderance of the evidence. That is, if some guy can show more evidence that unintentional acceleration caused his accident than Toyota can show that it didn't cause the accident, then he wins. He doesn't have to prove his story is true, he just needs to prove it's more likely than Toyota's story.

The problem being that you can't prove a negative - Toyota can't prove that the acceleration wasn't caused by some mysterious gremlin in their car's design. So they're forced to prove something else caused it. And if that something else is the guy putting his foot on the wrong pedal, how are they going to prove it since he's the only witness who knows?

The standard needs to be changed so the burden of proof rests upon the person claiming the less likely scenario happened.


RE: Public Perception
By mackx on 12/28/2012 3:20:24 PM , Rating: 2
personally i think more highly of them after this. the way they handled it put my faith in them. they did a recall, not just of the cars that would probably be affected but ones that might be.

as opposed to the firestorm tyre recall which (afaik) they decided on whether to recall or not based on the costs. wrongful death lawsuits vs the cost of the recall!!

toyota, you did good


RE: Public Perception
By Noonecares on 12/30/2012 11:27:55 AM , Rating: 2
The firestone tire thing was actually due to the car manufacturer's suggested psi for the newly emerging SUV. 20 something psi in a fully loaded explorer.. Yeah something will give.


RE: Public Perception
By Icehawk on 12/29/2012 10:44:48 AM , Rating: 2
If you think this is ridiculous (I do) - look at Audi, STILL paying for their "unintended acceleration" even though it was proved multiple times to be user error.

Yay, legal system.


It wasn't Faulty floor mats
By Nutzo on 12/27/2012 11:58:12 AM , Rating: 2
It wasn't Faulty floor mats, it was non-OEM/3rd party floor mats that caused the problem.

As for the people in San Diego who died in the crash, it wasn't just the floor mats. They could have simply turned the car off.
However, this car was a rental and had a push button start (no key), so they didn't know how to shut the car off. On most cars with a keyless ignition, if you need to shut the car off in an emergency, you need to press the start/stop button and hold it down for at least 4 seconds. Just like forced rebooting of a PC.




RE: It wasn't Faulty floor mats
By geddarkstorm on 12/27/2012 3:22:24 PM , Rating: 2
And if you're coming up on an intersection, four seconds (plus reaction/realization) is too long a time, unfortunately. That's why I like keys.

Still, this story did get crazy out of proportion. Have to feel bad for Toyota.


RE: It wasn't Faulty floor mats
By Camikazi on 12/27/2012 3:24:59 PM , Rating: 2
E-brake, jam brake pedal, shift to neutral all these things work as well as shutting off the engine. Honestly in any car I am in I am ready to put car into neutral if needed just in case something happens where it is needed.


RE: It wasn't Faulty floor mats
By Just Tom on 12/30/2012 11:54:46 AM , Rating: 2
All those things work better than shutting off the engine. Why would anyone want to shut off an engine when shifting to neutral stops all acceleration without losing power?


RE: It wasn't Faulty floor mats
By seamonkey79 on 12/27/2012 6:01:03 PM , Rating: 3
Don't feel bad for Toyota, feel bad for the next few years worth of people who are going to be paying extra for their Toyota's to cover the settlement.


RE: It wasn't Faulty floor mats
By Just Tom on 12/30/2012 12:00:23 PM , Rating: 2
Don't feel bad for Toyota, feel bad for the next few years worth of people who are going to be paying extra for their Toyota's to cover the settlement.

That is not how economics works. If charging more would lead to higher margins Toyota would already be doing so. I am pretty sure Toyota is already trying to maximize profits. This settlement will hurt workers and shareholders, not people buying new Toyotas. It might even lead to lower prices if the press coverage is bad enough that it leads to a decline in demand for Toyota's cars.


RE: It wasn't Faulty floor mats
By drycrust3 on 12/28/2012 12:26:32 AM , Rating: 2
quote:
On most cars with a keyless ignition, if you need to shut the car off in an emergency, you need to press the start/stop button and hold it down for at least 4 seconds.

Why don't they have a kill switch, like they do on a motorbike? What's that cost? A few dollars for a switch that sort of matches the decor, and a few more dollars for the wiring. You should be able to kill a vehicle in an instant, waiting 4 seconds may be too long.


RE: It wasn't Faulty floor mats
By bennyg on 12/28/2012 11:53:42 AM , Rating: 2
Take that few dollar cost
Multiply by the millions of vehicles sold in a year
...There's your answer why they don't do it


RE: It wasn't Faulty floor mats
By Stuka on 12/28/2012 2:10:00 PM , Rating: 2
Unfortunately, no one understands that the little card in their wallet with their photo on it, is actually a contract that states that they will operate a vehicle safely and within the limits of the law and that they are responsible for knowing how to do so in any non-commercial vehicle, and will not operate said vehicle if they cannot do so safely.

This is completely glossed over by our DMVs, our parents, our law makers, our law enforcers, the media, etc. The ONLY people who take it upon themselves to emphasize this at all are the guys teaching the traffic school AFTER you violate the law.


Not completely accurate
By MonkeySpooge on 12/27/2012 12:06:10 PM , Rating: 5
Of the 100 vehicles NHTSA tested they found that only 1 crash was found by the car mats, the Lexus dealer had put the wrong mats in their loaner cars which then got stuck under the pedal. The other 99 cars were found that the driver was pressing the gas pedal and not the brake. The results of the investigation can be found on the NHTSA website.

This story was over sensationalized in the media, now the media simply brushes the truth under the rug so they don't make themselves look like idiots.

Toyota has already paid so much for something that was the fault of one dealership. How many of us use proper mats in their car? I was looking forward for this tongi to court so the truth could come out. I guess Toyota settled so this accelerator thing could just go away.




RE: Not completely accurate
By Nutzo on 12/27/2012 12:32:45 PM , Rating: 2
quote:
How many of us use proper mats in their car?


I wore a hole in my Camry's floor mat after 10 year. Instead of taking a chance with a 3rd party mat, I bought a new set of Toyota mats off ebay at a pretty reasonable price.


RE: Not completely accurate
By MartyLK on 12/27/12, Rating: 0
RE: Not completely accurate
By Souka on 12/28/12, Rating: 0
RE: Not completely accurate
By MartyLK on 12/28/2012 1:55:51 AM , Rating: 1
If I did that, I'd have to put up with your type coming in and demanding replacement flaps because you couldn't cut them properly. You'd be constantly loitering and asking lame questions about how to do things. No doubt you'd drive the normal customers away with your incessant blathering - much like you just did.


RE: Not completely accurate
By conquistadorst on 12/28/2012 9:47:14 AM , Rating: 2
I don't even know what point you're trying to make? Maybe other than you're a simplistic moron yourself? Did I get it right?


RE: Not completely accurate
By MartyLK on 12/28/2012 2:11:56 PM , Rating: 1
Keep trying, it'll come to you eventually...maybe.


RE: Not completely accurate
By MartyLK on 12/30/2012 5:30:26 PM , Rating: 2
Apologies. I misread the link. Thought you were replying to my post. [smacks head in shame]


Domestic Aid
By heerohawwah on 12/27/2012 1:02:04 PM , Rating: 5
None of this has anything to do with safety. Toyota is just learning about playing ball in the USA. If your not a domestic car company you will be raped and strung up every now and again so that the domestic car companies can have an advantage. Welcome to the USA, land of the free, beware of those gama rays...




RE: Domestic Aid
By Just Tom on 12/30/2012 12:10:53 PM , Rating: 2
Um, you realize that domestic car companies lose lawsuits all the time? In 2006 lawsuits cost Ford $255,000,000, which was more than what the entire industry lost. This was just Toyota's turn in the barrel.

http://www.seattlepi.com/business/article/Lawsuits...


Paying for consumer stupidity
By Beenthere on 12/27/2012 1:47:01 PM , Rating: 2
Every test that was conducted by NHTSA and many other independent sources confirmed that there was no defect or reason other than operator error for the so called "unintended acceleration". It's no surprise that these "unintended acceleration" claims almost always exist in the U.S. where they hand out driver's licenses at Wally World.

The only thing that Toyota should be accountable for - indirectly, is the sticky accelerator pedal assemblies produce by a vendor - who also supplied sticky accelerator pedal assemblies to Ford and Chrysler. We don't see them being sued...yet but if the siren chasers think they can get some big money, they will sue anyone and everyone who has money.

The sticky accelerator pedals did not cause any accidents because the engines were essentially running at a high idle speed like when you start the engine cold. This lawsuit is a perfect example of U.S. stupidity and incompetence being paid for by a car maker, who did nothing wrong and who didn't sell a defective product.

BTW, I don't particularly like Toyota nor Honda and I have never owned one of their vehicles. The facts are the facts and this lawsuit should be tossed as it is meritless.




RE: Paying for consumer stupidity
By chick0n on 12/28/2012 5:13:55 AM , Rating: 2
welcome to the nanny state!!!!


What a waste...
By zodiacfml on 12/28/2012 6:30:58 AM , Rating: 2
I guess, Toyota should have taken it seriously and did all the settlements needed when it started. This is a waste in many aspects.




Driver test...
By conquistadorst on 12/28/2012 9:54:54 AM , Rating: 2
We have made the driving tests in the US too simple. We should be required to know/test the basic mechanics of our cars, how they work, reaction time, hand & eye coordination, road rules, and also basic roadside maintenance. I would also agree with retesting every 5 years.

I know many of our grandparents refuse to let go of their keys. Today, it's up to their children to make the difficult decision for them when the time comes. That should be suffice except many of their children aren't "around" to care for them and take over basic responsibilities.




YOU pay for this.
By bety on 12/29/2012 9:21:26 AM , Rating: 2
Make no mistake, yes, Toyota pays immediately, but in the end, one way or another, money does not materialize out of nowhere to give to idiots and scammers. The rest of us end up paying for frivolous lawsuits by people who are responsible for their own accidents or scammers (like the idiot who claimed he drove for hours....while talking to the news in his car....an OBVIOUS scammer).

Thanks for being societal parasites you plaintiffs!




"Google fired a shot heard 'round the world, and now a second American company has answered the call to defend the rights of the Chinese people." -- Rep. Christopher H. Smith (R-N.J.)














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