/ February 12, 2010

U.S. Class Action Suit Puts Brakes On Toyota

As the Japanese automaker launches global recalls of  8 million vehicles for repairs pegged on faulty floor mats and sticking gas pedals, Toyota also faces its first U.S. class action lawsuit due to braking problems in the 2010 Prius model. A class-action suit filed Monday on behalf of U.S. shareholders accuses Toyota Motor Corp. of issuing ”materially false and misleading statements” about its ”operations, its business and financial results and outlook.”

The suit seeks unspecified monetary damages and a court order requiring repairs to a braking defect that the named plaintiff, Elaine Miller, says makes driving her Prius dangerous. The lawsuits lists complaints of faulty brakes in its top-selling Prius hybrid car and investors claims that they were misled about problems with unintended acceleration in a wide range of models.

Miller’s lawyer, Daniel Warshaw,  said he brought the suit in California because the state has some of the nation’s toughest consumer protection laws and because Toyota’s U.S. operations are based there. According to Warshaw, the braking problem, apparently rooted in a computer software glitch, is most pronounced when trying to slow down or stop the vehicle on bumpy or slippery roads.

The suit details that Toyota “misled investors by failing to disclose that there was a major design defect in Toyota’s acceleration system, which could cause unintended acceleration.”

The National Highway Traffic Safety Administration, which is investigating the issue, has listed 124 such braking complaints from consumers since Feb. 3, including four reports of accidents, two of them said to have resulted in injury.

According to the suit, tens of thousands of vehicles may be affected. Toyota acknowledged it was aware of a braking problem and sought to fix it in production with a software adjustment starting in January, but 2010 models that rolled off the assembly line before that were sold without the change.

The 2010 model Prius was introduced in the United States in May 2009.

The Prius has been the world’s best-selling hybrid vehicle, helping Toyota grab 70 percent of the U.S. market for vehicles powered by a combination of an external-combustion engine and electric motor.

Read more of the Prius case here: Miller vs. Toyota Motor Sales, USA et al, Superior Court of the State of California for the County of Los Angeles, No. BC431344.

Source: Insurance Journal Online

As the Japanese automaker launches global recalls of  8 million vehicles for repairs pegged on faulty floor mats and sticking gas pedals, Toyota also faces its first U.S. class action lawsuit due to braking problems in the 2010 Prius model. A class-action suit filed Monday on behalf of U.S. shareholders accuses Toyota Motor Corp. of issuing ”materially false and misleading statements” about its ”operations, its business and financial results and outlook.”The suit details that Toyota “misled investors by failing to disclose that there was a major design defect in Toyota’s acceleration system, which could cause unintended acceleration.”The National Highway Traffic Safety Administration, which is investigating the issue, has listed 124 such braking complaints from consumers since Feb. 3, including four reports of accidents, two of them said to have resulted in injury.

The 2010 model Prius was introduced in the United States in May 2009.The Prius has been the world’s best-selling hybrid vehicle, helping Toyota grab 70 percent of the U.S. market for vehicles powered by a combination of an external-combustion engine and electric motor.Read more of the Prius case here: Miller vs. Toyota Motor Sales, USA et al, Superior Court of the State of California for the County of Los Angeles, No. BC431344.

Source:http://www.insurancejournal.com/news/national/2010/02/09/107227.htm

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