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Toyota Pays $1.2 Billion Penalty to U.S. Government for “Shameful” Conduct

A four-year criminal investigation into Toyota’s response to safety issues reached a conclusion just weeks ago when the car company agreed on a settlement with the U.S. government that may set a precedent for similar cases, as the penalty Toyota was forced to pay is the largest of its kind imposed on an automotive company by the U.S., as reported by Fox News.

 

Attorney General Eric Holder announced the settlement in mid-March, stating that the auto giant will pay $1.2 billion as a financial penalty under a “deferred prosecution agreement” for conduct which the attorney general referred to as “shameful.”

He said the automaker showed “a blatant disregard for systems and laws designed to look after the safety of consumers. By the company’s own admission, it protected its brand ahead of its own customers. This constitutes a clear and reprehensible abuse of the public trust.”

The automaker’s mistake is a glaring example of what not to do, according to Holder and the U.S. Attorney for the Southern District of New York, Preet Bharara, and this case should serve as a warning to other car manufacturers.

Toyota said in a statement that they have “cooperated with the U.S. Attorney’s office in this matter for more than four years” and had “made fundamental changes to become a more responsive and customer-focused organization, and we are committed to continued improvements.”

After the recall of more than 10 million vehicles beginning in 2009 related to faulty brakes, gas pedals and floor mats, Toyota Motor Corp. paid more than $66 million in fines from 2010 to 2012 for their delay in reporting unintended acceleration problems. In 2013, Toyota paid more than $1 billion to settle hundreds of lawsuits claiming that Toyota owners experienced economic losses due to the recalls.

These settlement negotiations come on the heels of a verdict in an Oklahoma case in which the jury awarded $3 million in damages to an injured driver of a 2005 Camry and to the family of a passenger who was killed.

In all previous unintended acceleration cases that went to trial, Toyota prevailed, making the Oklahoma ruling especially significant. The case was also the first in which attorneys argued that it was the car’s electronics that caused the unintended acceleration.

As far as the remaining cases go, Toyota may be more willing to agree on a broad settlement now after the Oklahoma case verdict. Prior to the Oklahoma case, juries in several trials hadn’t found Toyota liable.

The recalls cost Toyota millions, as did the series of fines to the National Highway Traffic Safety Administration (NHTSA) for the automaker’s delay in reporting the acceleration issues, which totaled $68 million.

If you own a Toyota that is experiencing any one of the aforementioned problems, or some other issue, don’t hesitate to contact an experienced Lemon Law attorney today!

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