Toyota to pay $1.2 billion
The U.S. has reached a $1.2 billion settlement with Toyota Motor Corp. and filed a criminal charge alleging the Japanese automaker defrauded consumers by issuing misleading statements about safety issues.
Attorney General Eric Holder said it's the largest penalty of its kind imposed on an automotive company by the United States.
Under the agreement, Toyota will admit that it misled U.S. consumers by making deceptive statements about two safety issues affecting its Toyota and Lexus vehicles.
Toyota declined comment Wednesday on a Wall Street Journal report of the settlement.
The four-year criminal investigation focused on whether Toyota was forthright in reporting problems related to unintended acceleration troubles.
Starting in 2009, Toyota issued massive recalls, mostly in the U.S., totalling more than 10 million vehicles for various problems including faulty brakes, gas pedals and floor mats. From 2010 through 2012, Toyota Motor Corp. paid fines totalling more than $66 million for delays in reporting unintended acceleration problems.
The National Highway Traffic Safety Administration never found defects in electronics or software in Toyota cars, which had been targeted as a possible cause.
The settlement continues a string of bad publicity for Toyota, which before the unintended acceleration cases had a bulletproof image of reliability. Since the cases surfaced, the company's brand image has been damaged and it has lost U.S. market share as competition has intensified.
Last year, Toyota agreed to pay more than $1 billion to resolve hundreds of lawsuits claiming that owners of its cars suffered economic losses because of the recalls. But that settlement did not include wrongful death and injury lawsuits that have been consolidated in California state and federal courts.
In December, Toyota filed court papers after a four-year legal battle saying that it's in settlement talks on nearly 400 U.S. lawsuits, but other cases aren't included in the talks.
The negotiations come less than two months after an Oklahoma jury awarded $3 million in damages to the injured driver of a 2005 Camry and to the family of a passenger who was killed.
The ruling was significant because Toyota had won all previous unintended acceleration cases that went to trial. It was also the first case where attorneys for plaintiffs argued that the car's electronics -- in this case the software connected to a midsize Camry's electronic throttle-control system -- were the cause of the unintended acceleration.
Toyota has blamed drivers, stuck accelerators or floor mats that trapped the gas pedal for the acceleration claims that led to the big recalls of Camrys and other vehicles. The company has repeatedly denied its vehicles are flawed.
Toyota also had to pay millions for recalls, as well as a series of fines totalling $68 million to the NHTSA, the U.S. government's road safety watchdog, for being slow to report acceleration problems.
Still, the payments won't hurt Toyota's finances very much. In its last fiscal quarter alone, Toyota posted a $5.2 billion profit, crediting a weak yen and strong global sales.
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