Toyota announced a proposal today worth over a billion dollars to settle civil claims of economic loss related to alleged cases of sudden unintended acceleration in its vehicles from 2009-2010. Estimates place the cost of the settlement between $1.1 billion and $1.4 billion, which would, according to lawyers for the plaintiffs, make it the largest of its type in US history.

US District Judge James Selna, who is presiding over the case in California, will review Toyota's settlement proposal as early as Friday.

The details of the settlement, as given by Toyota in an official statement and obtained from a press release issued by lawyers for the plaintiffs, are as follows.
  • Toyota will install brake override systems in all 3.25 million vehicles subjected to the floor mat entrapment recall.
  • A fund of $250 million will compensate former Toyota owners who sold their cars from September 1, 2009 through December 31, 2010 for lost value.
  • Another fund of $250 million will compensate current owners whose vehicles are not eligible for the free brake override system.
  • All 16 million current Toyota owners will be eligible for a customer care plan that warrants certain parts allegedly related to unintended acceleration for three to 10 years.
  • Education grants valued at $30 million will be made to independent academic institutions to further study auto safety and enhance driver education.
As mentioned above, the settlement relates only to claims of economic loss, and thus does not cover wrongful death claims, the first trail for which is slated to begin in February 2013.

Also worth noting is that investigations by the National Highway Traffic Safety Administration and NASA engineers concluded that electronics were not at fault in reports of unintended acceleration in Toyota vehicles, leaving only either those faulty floor mats or driver error as likely causes. Feel free to read through the entire press release below.
Show full PR text
Toyota Announces Settlement of Economic Loss Litigation That Provides Value to Customers

NEW YORK, Dec 26, 2012 –Toyota Motor North America today announced an agreement to resolve economic loss litigation in the U.S. related to previous recalls by committing to actions that deliver value to its customers.

"This agreement marks a significant step forward for our company, one that will enable us to put more of our energy, time and resources into Toyota's central focus: making the best vehicles we can for our customers and doing everything we can to meet their needs," said Christopher P. Reynolds, group vice president and general counsel, Toyota Motor Sales, U.S.A, and chief legal officer, Toyota Motor North America. "In keeping with our core principles, we have structured this agreement in ways that work to put our customers first and demonstrate that they can count on Toyota to stand behind our vehicles."

Reynolds continued: "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. However, 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."

If this economic loss settlement is approved by the judge supervising multidistrict litigation (MDL) pending in the U.S. District Court for the Central District of California, Toyota will launch a new customer-support program that will provide prospective supplemental coverage for certain vehicle components and will retrofit additional non-hybrid vehicle models subject to the floor mat recall with a free brake override system (BOS) to provide an added measure of confidence.

Further, assuming any appeals are resolved in favor of the settlement, Toyota will offer cash payments to eligible customers who sold or turned-in their leased vehicles in a period during 2009-2010, as well as other specified persons, and to eligible current owners and lessees who will not be offered BOS. The proposed settlement would also establish additional driver education programs and fund new research into advanced safety technologies.

Toyota also announced that it will take a one-time, $1.1 billion pre-tax charge against earnings to cover the estimated costs of the economic loss settlement and possible resolution costs of civil litigation brought in California by the District Attorney of Orange County and an investigation by a multi-state group of Attorneys General stemming from previous recalls.

For more information on the economic loss settlement, consumers are asked to visit www.toyotaelsettlement.com or call 877-283-0507.


I'm reporting this comment as:

Reported comments and users are reviewed by Autoblog staff 24 hours a day, seven days a week to determine whether they violate Community Guideline. Accounts are penalized for Community Guidelines violations and serious or repeated violations can lead to account termination.


    • 1 Second Ago
  • 58 Comments
      Max Bramante
      • 2 Years Ago
      AUDI 5000 SUDDEN UNINTENDED ACCELLERATION
      Timothy D. Naegele
      • 2 Years Ago
      Toyota has “caved,” which is an admission of guilt. While the automaker maintains that the settlement includes no admission of fault or unlawful conduct by Toyota, and allows the company to avoid the risks associated with battling a lengthy trial, this is pure folderol and boilerplate language in any settlement agreement. No American auto buyers should ever trust Toyota again! See http://naegeleblog.wordpress.com/2010/01/04/toyota-and-lexus-vehicles-are-unsafe/#comment-2362 (see also the article itself, as well as the other comments beneath it)
        • 2 Years Ago
        @Timothy D. Naegele
        [blocked]
        J.D
        • 2 Years Ago
        @Timothy D. Naegele
        So the NHSTA and NASA were wrong? And the american dealers who fitted floor matts incorectly and against factory instructions we right? So the people at ford and Hyundai aren't guilty of misleading the public at all. And Honda's airbag recalls are not compromising anyones safety at all...
        Avinash Machado
        • 2 Years Ago
        @Timothy D. Naegele
        You are being too harsh.
          dontneedpants
          • 2 Years Ago
          @Avinash Machado
          This might explain it: http://www.naegele.com/
      mckeejs
      • 2 Years Ago
      This completely ignores Toyotas That experienced witnessed multiple SUAs, would not drive their car because of these SUAs and then had only the option of trading in the first car for another and pay for the months "used" (read that parked), and not driven at all. Of course this cost 3 months out of 6 being unusable. Cost - $3100 + $900 in lawyers fees, all lost because of a part time Toyota abitrator. None of the many pages of documents from NTHSA sighting similar "close quarter SUAs" would be accepted by Toyota to even look at - they refused to even touch the binder of material presented. Still want to buy a Toyota? Good luck with arbitration.
        • 2 Years Ago
        @mckeejs
        [blocked]
          • 2 Years Ago
          [blocked]
          styxmiko
          • 2 Years Ago
          the real free loader in this story is Toyota...they are the ones who screw the american public out of billions of dollars for shoddy, inerior garbage products...they are the free loaders Where is Ralph Nader now?!
        404 not found
        • 2 Years Ago
        @mckeejs
        You touch yourself at night.
      Andre Neves
      • 2 Years Ago
      Now onto the rust issues.
        Bo Mayid
        • 2 Years Ago
        @Andre Neves
        they brought up the rust issue, it was because of an incompetent "american" supplier. I think autoblog wrote something about it
          Andre Neves
          • 2 Years Ago
          @Bo Mayid
          Right. Shift the blame to someone else. Typical of them. Too much "honor" to admit guilt.
      MAX
      • 2 Years Ago
      Reflashing the computers was an admission of guilt. Next the rusty frames.
        • 2 Years Ago
        @MAX
        [blocked]
      • 2 Years Ago
      [blocked]
        MAX
        • 2 Years Ago
        Hey Black dynamiteonline, you know so much about TRDyota, who is their highest ranking African-American?
      • 2 Years Ago
      [blocked]
      superchan7
      • 2 Years Ago
      Why, why, why is this still news? Every single article written about SUA brings out the UAW potheads screaming racist insults and "Buy American"--whatever that means.
      Bruce Lee
      • 2 Years Ago
      That recall was not related to any incidents of unintended acceleration, it was a recall for something that could theoretically happen over time, where the pedal would then stick open but since the pedals were so new it was mostly that the pedals were a little sticky on some cars.
      styxmiko
      • 2 Years Ago
      most toyotaphiles on this forum are blaming the SUA issue on driver error, many of them saying that these people are idiots. Now, I do agree that any person buying a toyota (or the expensive toyota) is an idiot, especially after all the recalls, defects, boring designs, appliance allure etc etc, but how on earth can these toyota buying idiots who blame the other toyota buying idiots for the SUA can explain the fact that all these "driver errors" that resulted in accidents, deaths and millions of dollars in damage to other people's properties were only happening to toyotas and no OTHER MANUFACTURER?!?!? I really don;t give a $hit what your answers are, dear toyota loving idiots, (so don't even try to "explain") I was just posing a viable question.
      oRenj9
      • 2 Years Ago
      I like to think that this is Toyota's punishment for all of those years of boring cars.
      Cruising
      • 2 Years Ago
      That’s just dandy, hand out cash because some people can not prepare themselves for driving? If your floor mat factory or not is sliding around and interfering with your driving ditch the dam things already. For a society that is supposedly technologically savvy you still have to be told like small children and dogs regarding common sense things, NO don‘t do it! Good boy here is a bucket of money.
        superchan7
        • 2 Years Ago
        @Cruising
        Mistake makers don't want to take responsibility for their own mistakes. The floor mat issue was genuine and you could argue that Toyota was in some remote, indirect way responsible for allowing its dealers to install incorrect accessories. But the pedal and electronics were NEVER proven to have any problems save for precautionary fixes.
    • Load More Comments