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Settlements Don't End Toyota's Legal Headaches
The National Law Journal
Toyota Motor Corp. has agreed to pay more than $1 billion to resolve hundreds of lawsuits centered on alleged sudden acceleration defects associated with the recall of more than 10 million vehicles, but the company's legal troubles don't end there.
Plaintiffs' attorneys have filed hundreds of lawsuits alleging that Toyota vehicles caused accidents that resulted in deaths and injuries. Those attorneys say nearly 500 such claims are pending nationwide, although Toyota has pegged that number at closer to 300 in filings with the U.S. Securities and Exchange Commission. At least three trials are scheduled this year.
"The settlements thus far don't do anything for the people who have been injured or killed in Toyota vehicles," said Todd Walburg, a partner at San Francisco's Lieff Cabraser Heimann & Bernstein. He holds a seat on the plaintiffs steering committee in multidistrict litigation against Toyota pending in Santa Ana, Calif. "We expect that there will be multiple trials going forward across the country from this point on."
Toyota spokeswoman Celeste Migliore agreed. "While Toyota may decide from time to time to settle select cases, we will have a number of other opportunities to defend our product at trial in multidistrict litigation and other legal venues," she said via email. "We would emphasize that at no time has anyone put forth any reliable scientific evidence of an alleged electronic defect in our vehicles that could cause unintended acceleration."
Toyota's largest settlement, valued by plaintiffs' attorneys at $1.3 billion, would resolve economic damages claims brought by consumers who assert the company misled them about the safety of its vehicles. Toyota agreed to the deal on December 26. A final-approval hearing on that settlement is scheduled for June 14.
That settlement would resolve a class action in the multidistrict litigation that had been planned for trial this summer before U.S. District Judge James Selna.
On February 14, Toyota agreed to pay $29 million to resolve investigations by attorneys general in 29 states and the U.S. territory of American Samoa into whether it had fully disclosed sudden-acceleration defects to consumers. Toyota has agreed to pay another $25.5 million to settle litigation alleging its executives misled shareholders of its American depositary shares. U.S. District Judge Dale Fischer preliminarily approved that agreement on January 3, and a final-approval hearing is scheduled for March 11.
Toyota abruptly settled two individual cases days before they were scheduled for trial, on undisclosed terms. One case had been scheduled to go to trial on January 2 in Los Angeles County, Calif., Superior Court. The other, scheduled for trial on February 19 as the first bellwether in the multidistrict litigation, involved a driver who died, along with a passenger, after his car crashed at an exit ramp off a highway in Utah. Two other passengers were injured.
That leaves the bulk of the personal injury and wrongful death cases. They are spread across the nation, with several pending in the multidistrict litigation or in separately coordinated proceedings in state courts in California, Texas and New York.
There's no guarantee that Toyota will settle any of them, said Carl Tobias, professor at the University of Richmond School of Law who specializes in tort and product liability cases.
"The big issue will be, when there's a really strong case, will they settle that case like they did the bellwethers scheduled, which plaintiffs felt were strong or will they try them?" he said. "Usually these MDLs play out in a way, certainly in the pharmaceutical area, that they at some point decide to settle. But often they fight the first 10 or however many cases vigorously."
Trials in California
In both coordinated proceedings in California, Toyota faces trials.
In the multidistrict litigation, plaintiffs attorneys are moving forward with the second bellwether case, brought on July 8, 2010, by a woman in Columbus, Ga., who suffered spinal fractures after her 2005 Camry accelerated into a column near the door of an elementary school gymnasium.
"She stopped at a stop sign. She looked both ways, and then just as she started to enter the intersection her vehicle suddenly accelerated out of control and went straight onto the property of the elementary school and accelerated through a grove of trees, past a fence and eventually slammed into the school gymnasium," Walburg said. "She clearly testified that she tried to hit the brakes multiple times, and the vehicle would not stop."
The case, which Toyota selected as its top bellwether case, is scheduled for trial on November 4.
The driver, Ida St. John, who was 83 years old at the time of the 2009 accident, has since died, leaving the case in the hands of her estate, according to court documents filed on December 17. Walburg said he is investigating whether St. John's death was tied to injuries she suffered during the crash.
As if to underscore their determination to go to trial, plaintiffs attorneys on February 11 appointed W. Mark Lanier of The Lanier Law Firm in Houston to present the case to a jury. Lanier acknowledged that Toyota handpicked the St. John case for trial. "Toyota has picked cases I'm sure they think they can win," he said. "If they lose, oh my goodness can you imagine if they can't win one of the best cases in the entire world? What will they do when we try a good one?"
Migliore, of Toyota, wrote in her email to the NLJ: "We sympathize with anyone in an accident involving one of our vehicles. However, we look forward to the time when plaintiffs' counsel will be compelled to back up their defect claims with scientifically reliable, admissible proof as opposed to speculative statements. Toyota is confident that no such proof exists and that the evidence will confirm what millions of Toyota drivers prove every day: that they can depend upon their vehicles to provide safe, reliable transportation."
The other case was brought by a man whose wife died after her 2006 Camry accelerated to a speed of 100 miles per hour before crashing into a telephone pole. The case, scheduled for trial on June 12, would be the first in the state court proceeding in California to go before a jury.
The Outlier in Oklahoma
Apart from the coordinated proceedings, Toyota faces litigation in state courts across the country. One of those cases, filed in Oklahoma County, Okla., District Court, is scheduled for trial on October 7. The matter involves a woman from Yukon, Okla., who was injured in 2007 after her vehicle accelerated down an exit ramp and slammed into a culvert. Her friend, a front-seat passenger, died from her injuries soon after the accident.
Lead plaintiff's attorney R. Graham Esdale Jr. said his client, Jean Bookout, tried to apply the brakes. "She left 150 feet of skid marks at the bottom of the exit ramp," said Esdale, a shareholder at Beasley, Allen, Crow, Methvin, Portis & Miles in Montgomery, Ala.
Toyota's Migliore wrote: "Again, we sympathize with those in an accident involving one of our vehicles, but we continue to stand fully behind the safety and integrity of Toyota's Electronic Throttle Control System, which multiple independent evaluations have confirmed as safe."
Toyota is represented in this case by James Jennings, founding member of Jennings Cook & Teague in Oklahoma City. Toyota's primary trial team in personal injury and wrongful death cases in California has been led by Vincent Galvin Jr., executive managing partner of Bowman and Brooke's San Jose, Calif., office.
Esdale said he intends to use discovery in the multidistrict litigation proceeding at trial, noting that both his client and St. John were driving a 2005 Camry. He said he felt confident his case would go to trial.
"We've not discussed any settlements," he said.
This article originally appeared in The National Law Journal.