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Tuesday, December 21, 2010

Toyota agrees to pay additional $32 million in fines to US government over safety defects
Julia Zebley at 12:47 PM ET

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[JURIST] Toyota Motor Corporation [corporate website; JURIST news archive] settled US federal investigations on Tuesday by agreeing to pay a record $32.4 million in extra fines for product defects and poor handling of a recall. The fines stem from two investigations conducted by the National Highway Traffic Safety Administration (NHTSA) [official website]. The first, a fine of $16.375 million, concerned nearly five million vehicles with accelerator pedals entrapped by floor mats, which caused at least one fatal accident in California. The second, a fine of $16.050 million, resulted from Toyota's failure to notify the NHTSA of a safety defect in several Toyota models' steering relay rods. In that situation, Toyota had already recalled the faulty products in Japan in 2004, but delayed recall in the US until 2005. In a press release [text], NHTSA Administrator David Strickland said, "NHTSA acknowledges Toyota's efforts to make improvements to its safety culture, and our agency will continue to hold all automakers accountable for defects to protect consumers' safety." Toyota also announced news of the settlement in a press release [text], stating that they were "pleased to have resolved these legacy issues related to the timeliness of prior recalls dating back to 2005." The total fines against Toyota amount to $48.8 million and will be paid into the Treasury Department's General Fund. Although the NHTSA investigations have been satisfied, consumer-fraud class action and personal injury lawsuits stemming from the same safety defects remain open in California as well as in federal court [JURIST reports].

In April, Toyota accepted a record civil penalty of $16.375 million [JURIST report], imposed by the NHTSA for a four-month delay in notifying the agency about a problem with "sticky" and "slow to return pedal" gas pedals in various car models. A week earlier, the US Judicial Panel on Multi-District Litigation (MDL) [official website] consolidated [JURIST report] more than 150 pending lawsuits against Toyota and transferred them to the US District Court for the Central District of California [official website]. In March, the NHTSA enlisted the help of the National Academy of Sciences (NAS) and NASA [official websites] to conduct a 15-month investigation into the sources of recent safety defects. Toyota has been under federal scrutiny since December 2009, and has conducted several recalls. Toyota's product recalls have been analyzed by Forum guest columnist Bruce Aronson of Creighton University School of Law in the op-ed Learning from Toyota's Troubles - Where's the Board? [JURIST op-ed].




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