The agreement, filed in federal court in California, was called one of the largest product-liability settlements in history.
If the agreement is approved by the court, Toyota would compensate current and former owners for loss of value on vehicles recalled because of faulty floor mats and other conditions that could cause sudden acceleration.
Toyota has also agreed to install special safety systems on 3.2 million vehicles that were recalled for floor-mat problems.
The class-action suit was filed in 2010 after widespread complaints were made to federal safety regulators about Toyota models that accelerated unexpectedly.
Toyota has since recalled about eight million vehicles in the United States for problems relating to floor mats and sticky accelerator pedals.
After a long investigation, the National Highway Traffic Safety Administration said there was no evidence that electronic systems contributed to unintended acceleration in Toyota vehicles.
The law firm representing Toyota owners in the class-action suit said the overall settlement was estimated at $1.2 billion to $1.4 billion.
“We are extraordinarily proud of how we were able to represent the interests of Toyota owners, and believe this settlement is both comprehensive in its scope and fair in compensation,” said Steve Berman, one of the lead lawyers for the plaintiffs.
Toyota said in a statement that it would compensate customers for loss of value of their vehicles, as well as retrofit additional cars with a free safety system that prevents unintended acceleration.
The company said it will take a onetime, $1.1 billion charge against earnings to cover the costs of the settlement and possible resolution of other pending litigation.
“This agreement marks a significant step forward for our company,” said Christopher Reynolds, Toyota’s chief United States legal officer. “In keeping with our core principles, we have structured this agreement in ways that work to put our customers first.”
Article source: http://www.nytimes.com/2012/12/27/business/toyota-settles-lawsuit-over-accelerator-recalls-impact.html?partner=rss&emc=rss
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