Hagens Berman: Toyota Agrees to Fund a Settlement of Unintended Acceleration Cases Worth up to $1.4 Billion
December 26 2012 - 4:22PM
Business Wire
The attorneys representing Toyota (NYSE:TM) owners who claim
that their vehicles are prone to sudden, unexplained acceleration
today announced that Toyota has agreed to a settlement valued
between $1.2 and $1.4 billion, which includes direct payments to
consumers as well as the installation of a brake-override system in
an estimated 3.25 million vehicles.
The case was filed in 2010 after drivers across the country
began reporting that Toyota vehicles suddenly and unintentionally
accelerated. Toyota has long maintained that the vehicles were free
from electronic flaws causing the acceleration.
Neither the National Highway Traffic Safety Administration
(NHTSA), nor the National Aeronautics and Space Administration
(NASA) was able to find any defects in Toyota’s source code that
could cause these events.
After a flurry of lawsuits were filed against Toyota, Judge
James Selna consolidated the cases in U.S. District Court in
California and appointed attorney Steve Berman, managing partner of
Hagens Berman Sobol Shapiro as co-lead counsel on May 14, 2010,
placing Berman in charge of directing the class litigation and
leading settlement discussions with the Japanese auto
manufacturer.
“After two years of intense work, including deposing hundreds of
engineers, pouring 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,” said Berman.
Under the terms of the proposed settlement, Toyota will install
a brake-override system in vehicles subject to floor mat entrapment
recalls. Brake-override systems cut power to the throttle under
certain circumstances when the car receives simultaneous signals to
accelerate and to stop.
In addition, the settlement establishes a fund of $250 million
to be paid to former Toyota owners who sold their cars during the
period from Sept. 1, 2009, through Dec. 31, 2010, to compensate
those owners for an alleged reduced value as a result of publicity
concerning unintended acceleration.
A separate fund of $250 million will be established to
compensate current owners whose vehicles are not eligible for a
brake-override system. The amount consumers receive depends on the
model and year of their Toyota, and the state in which the car was
purchased.
The settlement also provides that all 16 million current owners
will be eligible for a customer care plan that will warranty
certain parts that plaintiffs allege are tied to unintended
acceleration for between three and 10 years.
The agreement also provides $30 million in education grants to
independent academic institutions to further the study of auto
safety and to enhance driver education. “We hope that this research
can aid in finding out the causes of unintended acceleration, and
the solutions to fixing those issues,” said Berman.
The total value of the settlement is estimated to be between
$1.2 and $1.4 billion. This estimate amounts to the largest
settlement of this type in US history in terms of dollars paid out
and number of vehicles involved.
Judge Selna is expected to review the proposed settlement on
Dec. 28, 2012, and if he agrees with its fairness, will grant
preliminary approval.
Current and former Toyota owners will receive information about
the settlement and instructions on filing a claim in the coming
months.
“From the very start, this was a challenging case,” Berman
added. “We brought in automotive experts, physicists and some of
the world’s leading theoreticians in electrical engineering to help
us understand what happened to drivers experiencing sudden
acceleration. We are extraordinarily proud of how we were able to
represent the interests of Toyota owners, and believe this
settlement is both comprehensive in its scope and fair in
compensation.”
Limited details of the settlement are available at
www.hbsslaw.com/toyota, www.ToyotaELsettlement.com or by calling
1-877 283-0507. More information will be available once the court
gives preliminary approval to the settlement.
BROADCAST MEDIA:
Broadcast quality video featuring Steve Berman commenting on the
settlement is available at ftp.clatterdin.com. The username to
access the clips is “HBSS” and the password is “generic.”
About Hagens Berman
Seattle-based Hagens represents whistleblowers, investors and
consumers in complex and class-action litigation. The firm has
offices in 10 U.S. cities including New York,
Boston, Chicago, Phoenix, Los Angeles, San
Francisco and Washington, D.C. More about the law firm
and its successes can be found at www.hbsslaw.com. Visit the
firm's class-action law blog at www.classactionlawtoday.com.
Photos/Multimedia Gallery Available:
http://www.businesswire.com/multimedia/home/20121226005172/en/
Toyota Motor (NYSE:TM)
Historical Stock Chart
From Jun 2024 to Jul 2024
Toyota Motor (NYSE:TM)
Historical Stock Chart
From Jul 2023 to Jul 2024