Settlement Receives Preliminary Approval in Unintended Acceleration Suit

Preliminary approval has been given to Toyota Motor Corp’s
$1.1 billion settlement of a class-action lawsuit brought forward by customers
who claimed to have lost value on their cars due to the issues of unintended
acceleration. U.S. District Judge James Selna of Santa Ana, California, who
gave the approval, also announced a hearing for final approval of the deal in
June, writing that “Settlement will likely serve the interests of the class
members better than litigation.”

The settlement will provide $500 million in cash for
plaintiffs, along with installations of break override systems and a customer
support program valued at a combined total of $600 million. More than 16
million Toyota, Lexus, and Scion vehicles will be covered, from the 1998 to 2010
model years. The plaintiff lawyer on the case, Steve Berman, said that he was
pleased with the results, and the favorable comments from the district judge. Julie
Hamp, a spokeswoman for Toyota, said that the company was gratified with the
approval of the settlement, “which will provide value to our customers and
provides an extra measure of confidence in their vehicles.”

Not included in the settlement are wrongful death and injury
lawsuits, of which there are as many as 300, according to a filing from Toyota
in June. Those plaintiffs and their personal injury lawyers will therefore need
to seek continued legal action if they are to receive compensation for the
damages that they have sustained in accidents caused by unintended acceleration.

Toyota has admitted no fault in proposing the settlement
however, which will total as one of the largest in US history involving
automotive defects. The maker has long maintained that the issues causing
unintended acceleration had nothing to do with their electronic throttle
control system, widely regarded as the main problem, and that poorly fitting
floor mats and sticky gas pedals were to blame, which have long since been
fixed. A study performed by the National Highway Traffic Safety Administration confirms
Toyota’s claims, citing no link between the throttle control system and
instances of unintended acceleration.

Nevertheless, Toyota is hopeful that the approval of the
settlement can bring about an end to their saga, which has seen extensive press
coverage and multiple vehicle recalls spanning from 2009 through 2011. In his
decision, Judge Selna said that the settlement was a fair conclusion, avoiding
overly complicated legal fights and litigation that could drag on for years. “Some
of these rulings have been favorable to plaintiffs; some have been favorable to
Toyota,” says Selna. “Were the parties to proceed to a fully
litigated result, virtually any outcome would face the risk of uncertainty upon
appellate review of these rulings.”

And yet despite the continued hits to Toyota’s reputation for
reliability and safety, the company has seen tremendous sales gains through
2012. As of November, the auto maker is boasting an increase in sales of almost
29%, significantly larger than the industry wide gains of 14%. Their share of
the US market has also grown to 14.4%, up from just 12.7% in 2011. Despite
continued recalls and residual sudden acceleration worries, buyers continue to
purchase new models, perhaps suggesting that even in their missteps and
setbacksComputer Technology Articles, Toyota’s model offerings are still well beyond their competitors.

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