Toyota Reaches $29 Million Settlement with 29 States

Toyota Reaches $29 Million Settlement with 29 States
February 15, 2013

Toyota Motor Corp. has reached a settlement to the tune of $29 million with 29 attorneys general in 29 U.S. states and one U.S. territory.

The deal was disclosed yesterday and reportedly approved in December. The money will be divided among the 29 states and American Samoa.

In a statement, Christopher P. Reynolds, group vice president and general counsel for Toyota Motor Sales, USA, and chief legal officer for Toyota Motor North America, says, "Resolving this inquiry is another step we are taking to turn the page on legacy issues from Toyota's past recalls in a way that benefits our customers. Immediately after this inquiry was launched in 2010, Toyota began cooperating fully with the attorneys general and implementing 'customer-first' initiatives to address their concerns and those of our customers. Today, we are pleased to have reached a cooperative agreement that reflects the commitment of Toyota's 37,000 North American team members to put customers first in everything we do."

Toyota most recently came under fire in December after announcing a $1.1 billion settlement resulting from consumer lawsuits over inadvertent acceleration and continues to face scrutiny over safety. In October the company recalled more than 7.5 million vehicles for faulty power window switches that can potentially catch fire. Additionally, in 2008 the National Highway Traffic Safety Administration (NHTSA) investigated Toyota for reports of spontaneously shattering side lites.The company also issued a recall of more than 1 billion vehicles at the end of January for faulty windshield wipers and airbag defects.

As part of the agreement, Toyota plans to work toward making "vehicle information more easily accessible to consumers to help them operate their vehicles safely and make more informed choices."
The company also says it has "agreed to continue other customer-focused initiatives, including its rapid-response service teams, its expanded network of product quality field offices across the US and a range of customer care amenities for owners of vehicles subject to certain recalls."

According to court documents, Toyota, as part of the settlement deal agrees to pay at its own expense, "for a period of one year after entry of this Agreed/Stipulated Final Judgment, to consider in good faith customer requests for reimbursement, as appropriate on a case-by-case basis (and to the extent a consumer has not already been reimbursed) for those consumers who have filed complaints, or who may file complaints or requests for reimbursements with Toyota or with any attorney general's office of any signatory state, or any signatory state or federal regulator, in which the consumer reasonably substantiates and documents reasonable taxi fares, towing costs, rental car costs or other similar expenses."

A release issued by Texas Attorney General Greg Abbott says the "settlement resolves a multistate investigation into Toyota's actions in the wake of the discovery that certain vehicle models were susceptible to sudden, spontaneous accelerations. Specifically, the states investigated whether Toyota adequately and promptly disclosed that its voluntary recalls had safety implications for vehicle owners of its most popular models, including the Camry and Lexus sedans, the Tundra and Tacoma trucks and the Prius hybrid."

This settlement focuses on safety recalls issued by Toyota between 2005 and 2010.

Despite facing multiple recalls, the Insurance Institute for Highway Safety (IIHS) has ranked 12 separate Toyota models in its 2013 Top Safety Pick list. The safety picks may mean little for some consumers; a Los Angeles Times poll shows, at press time, 44 percent of readers say they would not buy a Toyota today.

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