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Toyota Reaches $1 Billion Settlement

be1160400a0d02b7005902cae82579ad.jpg Toyota Motor Corporation has reached a settlement with Toyota owners who claim the value of their cars and trucks “plummeted after a series of recalls stemming from claims that Toyota vehicles accelerated unintentionally.” The settlement, which is worth more than $1 billion, was filed today and must be approved by a U.S. District Judge. Pending approval, Toyota owners are happy with the settlement. Steve Berman, one of the lawyers representing the owners, stated, “We kept fighting and fighting and we secured what we think was a good settlement given the risks of this litigation.” This is the largest settlement in United States history for an automobile defect claim.

Toyota said the company would make a “one-time, $1.1 billion pre-tax charge against earnings to cover the estimate costs of the settlement.” Berman believes that actual value of the settlement is between $1.2 and $1.4 billion. Hundreds of lawsuits have been filed against Toyota, beginning in 2009, after it was discovered that the cars accelerated on their own, resulting in many crashes, injuries and deaths. Those who filed wrongful death suits against the carmaker are not part of this settlement; that trial is expected to begin in February. Those who suffered economic loss are part of this settlement and will receive cash payments from Toyota. “Toyota will offer cash payments from a pool of about $250 million to eligible customers who sold vehicles or turned in leased vehicles between September 2009 and December 2010.”

Toyota will also launch a $250 million settlement for the 16 million current owners to “provide supplemental warranty coverage for certain vehicle components.” Toyota has also created an override system that will ensure that the car will stop when the brakes are applied, even if the accelerator pedal is depressed. Further, additional driver education programs will be provided and Toyota will fund new research for vehicle safety technologies. More information is available at www.ToyotaELsettlement.com.

Settlement reached in Toyota acceleration cases, www.miamiherald.com December 26, 2012.


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