Toyota Makes Legal Troubles Go Away for $1 Billion

Dashiell Bennett
Toyota Makes Legal Troubles Go Away for $1 Billion

The world's largest automaker has agreed to settle dozens of state and federal lawsuits filed over acceleration problems in their cars in exchange for $1.1 billion in damage payments. Toyota Motor Corp, was facing a lengthy class-action legal fight against several state attorney generals over claims that safety defects (such as poorly designed floor mats) were causing sudden unexplained acceleration in Prius hybrids, Lexus SUVs and other car models. The settlement would be the largest legal payout ever made by a car company in the United States.

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The company continues to insist it did nothing wrong and will not be required to admit computer or engineering faults, but said that settling the lawsuits now was simply in the company's best interest. Just last week the company agreed to pay $17 million in fines to the National Highway Traffic Safety Administration for failure to report safety defects.

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While the settlement ends the company's fight against the government, it still faces numerous civil lawsuits for personal injury and wrongful death that have been filed since 2009. Toyota says it will continue to defend against those suits, even after numerous recalls and safety investigations have weakened the company's reputation and cost it millions in fines and legal costs. One of the earliest and most notorious wrongful death cases—a 2009 crash that killed a family in San Diego—was settled in 2010 for $10 million. One attorney for a still existing plaintiff believes that class action damages could exceed the $1 billion in economic penalties agreed to in the settlement.

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The settlement offer was submitted on Wednesday, but still requires approval from the court.