Toyota Motor Corp. announced in December 2012 that it reached a settlement for more than $1 billion over hundreds of lawsuits from Toyota owners who claimed their vehicle’s value dropped severely due to complaints of unintentional acceleration. A lawyer representing the owners told the Associated Press the settlement is the largest in U.S. history for vehicle defects.
The AP reported that the manufacturer will take a $1.1 billion pre-tax charge against earnings to pay the settlement, which is valued between $1.2 billion and $1.4 billion.
The lawsuits were consolidated in a class action case in U.S. District Court in Santa Ana, Calif., and cover a variety of vehicles made from 1998-2010. The Santa Ana cases affected by this settlement are for economic loss. Other cases involving claims of injury or death aren’t covered. The first trial regarding injury or death is scheduled for February, according to the AP.
Toyota will offer cash payments to eligible customers who sold vehicles or turned in leased vehicles between September 2009 and December 2012. Toyota also will provide supplemental warranty coverage for some vehicle components for 16 million current owners and retrofit about 3.2 million vehicles with a brake override system.
Although Toyota agreed to settle the lawsuits, the company denies violating any law, engaging in any wrongdoing and that there is any defect in its electronic throttle control systems.
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- FindLaw.com: Settlement reached in Toyota acceleration cases
- Toyota Economic Loss Settlement Website: Frequently asked questions