Toyota faces $1.1 billion settlement in runaway car lawsuit

Michael James

The strange, twisting and lingering litigation against Toyota has been settled with the Japanese automaker agreeing to pay more than $1 billion to settle U.S. litigation via claims its vehicles suddenly and unintentionally accelerated.

According to court documents the deal, pending California federal judge approval, includes direct payments to customers as well as installation of a brake override system in about 3.25 million vehicles.


The terms include a $250 million fund for former Toyota owners who sold who sold or turned in their leased vehicles between September 2009 and December 2010 at reduced prices because of bad publicity. And there’s also a separate $250 million fund for owners not eligible for the brake override system.

Plaintiff attorneys are slated to receive up to $200 million in fees and $27 million in costs, according to courts documents released Dec. 26, 2012.

In 2010, Federal safety regulators investigated reports there were as many as 89 U.S. crash deaths since 2000 may have been linked to unintended acceleration in Toyotas and Lexus vehicles.

“There is no electronic-based cause for unintended high-speed acceleration in Toyotas,” U.S. Transportation Secretary Ray LaHood said in a statement at the time.

The recalls and government scrutiny resulted in testimony by Chief Executive Akio Toyoda at congressional and more than $30 million in fines.

The probe by the National Highway Traffic Safety Administration and NASA engineers found the only causes of the unwanted acceleration were the previously identified sticking accelerator pedals and loose floor mats that could jam the pedals.

Toyota, which has put electronically controlled throttles in its vehicles since 2002, has maintained those systems were safe.

Despite the now two-year-old findings, the carmaker faced numerous related lawsuits in federal and state courts, which have now also been determined.

“We felt we achieved our objective, to defend the safety of the product,” said Toyota spokesman Mike Michels. That having been done, the settlement is “a business decision and we turn the page on a lot of this.”

Toyota has recalled more than 14 million vehicles worldwide due to acceleration problems in several models and brake defects with the Prius hybrid. Toyota has blamed driver error, faulty floor mats and sticky accelerator pedals for the unintended acceleration.


Article Last Updated: March 19, 2014.

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