Legal Professional?
Build Your Business

Insurance Companies Now Suing Toyota Over Unintended Acceleration

Toyota Motor Corporation has been hit with another suit over alleged defects in its vehicles that can cause them to accelerate suddenly and cause collisions. This is in addition to a recent case where Toyota paid $10 million to settle litigation from the relatives of four people who were killed in a crash in August 2009.

New Lawsuit Pursued by Insurance Companies

The new lawsuit is being pursued not by Toyota customers but by their insurance companies. Seven insurers, including Firemen's Fund Insurance Company, are seeking reimbursement of more than $200,000 in damages that they have had to pay to or on behalf of their insureds. The complaints allege that some Toyota vehicles contain a defect that causes uncontrolled acceleration to speeds of up to 100 miles per hour or more. Although more than 725 crashes have been blamed on these defects, only 14 throughout the United States are at issue in the action. Toyota, through a spokesperson, continued to deny that any defect in its vehicles caused unintended acceleration.

This lawsuit by insurance companies against Toyota is not the first, nor likely the last. Allstate Corporation sued Toyota for similar reasons last year. Allstate sought reimbursement of more than $3 million it paid in connection with 270 accidents. It appears that the majority of insurers involved in the 725 collisions have not started lawsuits as yet.

Class Action Pending in Santa Ana, California

In addition to the lawsuits by the insurance companies and from injured parties, a class action is now pending in federal court in Santa Ana, California, against Toyota by owners of Toyota vehicles who claim the value of their cars has been diminished because of the alleged acceleration problem. This case is pending before the same judge who is hearing the consolidated lawsuits brought by the personal injury plaintiffs.

Commentators believe that Toyota can expect a wave of litigation, especially after the $10 million settlement it agreed to in December 2010. Although the settlement was supposed to be confidential, it was leaked to the press, much to Toyota's "disappointment," according to a company spokesperson. Settlements do not result in a determination of liability but are often paid to dispose of a case without such a determination. However, according to plaintiffs' attorneys, Toyota's willingness to pay such a large amount indicates that Toyota knows it is unlikely to win these cases.

Update: The Department of Transportation has recently issued a study saying that Toyota's electronics had nothing to do with the problem.  This will not end the litigation, but it clarifies where plantiffs are likely to lay their blame: the floor mats.

Source: LA Times & ABCNews