Toyota proposes economic loss settlement worth up to $1.4 billion over unintended acceleration claims
Filed under: Government/Legal , Recalls , Safety , Toyota , Earnings/Financials Toyota announced a proposal today worth over a billion dollars to settle civil claims of economic loss related to alleged cases of sudden unintended acceleration in its vehicles from 2009-2010. Estimates place the cost of the settlement between $1.1 billion and $1.4 billion, which would, according to lawyers for the plaintiffs, make it the largest of its type in US history. US District Judge James Selna, who is presiding over the case in California, will review Toyota’s settlement proposal as early as Friday. The details of the settlement, as given by Toyota in an official statement and obtained from a press release issued by lawyers for the plaintiffs, are as follows. Toyota will install brake override systems in all 3.25 million vehicles subjected to the floor mat entrapment recall . A fund of $250 million will compensate former Toyota owners who sold their cars from September 1, 2009 through December 31, 2010 for lost value. Another fund of $250 million will compensate current owners whose vehicles are not eligible for the free brake override system. All 16 million current Toyota owners will be eligible for a customer care plan that warrants certain parts allegedly related to unintended acceleration for three to 10 years. Education grants valued at $30 million will be made to independent academic institutions to further study auto safety and enhance driver education. As mentioned above, the settlement relates only to claims of economic loss, and thus does not cover wrongful death claims, the first trail for which is slated to begin in February 2013.