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Released: December 27, 2012

Toyota to settle lawsuit tied to accelerations

Source: Bill Vlasic, N.Y.Times (Free Registration)

Toyota Motor agreed on Wednesday to pay more than $1 billion to settle a class-action lawsuit related to issues of unintended acceleration in its vehicles.

The proposed settlement, filed in a Federal District Court in California, would be one of the largest of its type in automotive history. If the agreement is approved by Judge James V. Selna, Toyota would make cash payments for the loss of value on vehicles affected by multiple recalls and install special safety features on up to 3.2 million cars.

Under the proposed settlement, Toyota agreed to create a fund of $250 million to pay claims to former owners of cars affected by the acceleration recalls. The company also agreed to install so-called brake override systems on cars whose pedals could stick or become trapped in floor mats. The company said it had already installed the systems on 2.6 million vehicles but that an additional 550,000 cars had not received the equipment.

In addition, the settlement provides a customer support program for more than 16 million current Toyota owners, who will be eligible for free repairs on certain parts for up to 10 years.

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