"Safety Deaf" Toyota to Pay Record Fine

Categories: Cover Story
toyota settlement april 19.jpg
Toyota announced today that it would pay the National Highway Traffic Safety Administration $16 million to settle allegations that it kept quiet about safety defects on its cars. The penalty is the largest that the federal government has collected from a car company.

"Toyota could have contested the fine, but chose not to," Cindy Knight, a spokeswoman for company, told Hair Balls via e-mail. "We do deny NHTSA's allegation that we violated safety regulations. We wished to focus our efforts on moving forward as well as avoiding potential litigation."

She continued, "NHTSA said if we do not pay, they will refer the matter to the U.S. Department of Justice, with the recommendation that the Attorney General commence a civil action in Federal court against Toyota for maximum civil penalties and other relief."

Back in February, the government started investigating Toyota after the company announced for months different recalls and fixes for problems with unintended acceleration in its cars. (Unintended acceleration in the Toyota Prius was the topic of an April 2009 Houston Press cover story.) Toyota even announced that it would stop selling eight different models.

But the feds were concerned that Toyota had been hiding knowledge of safety defects, so the company had to hand over about 120,000 pages of documents. The smoking gun in this case was information sent to dealerships in Europe and Canada about how to repair faulty gas pedals. Trouble was, Toyota didn't send anything to dealerships in America, despite, the feds say, knowing that there were problems here, too.

The same day those orders were sent out -- September 29, 2009 -- Toyota issued a recall concerning unintended acceleration, but it blamed the problem on floor mats.

The government announced the findings at the beginning of this month and said it would seek the largest penalty allowable by law. "We now have proof that Toyota failed to live up to its legal obligations," U.S. Transportation Secretary Ray LaHood said in the announcement. "Worse yet, they knowingly hid a dangerous defect for months from U.S. officials and did not take action to protect millions of drivers and their families."

And there could be more penalties for Toyota. LaHood said that "it would not surprise me if we discovered other information." He went on to call Toyota, which is now facing more than 200 lawsuits involving its cars, "safety deaf."

It's unclear how this settlement will effect any of the pending lawsuits.

We're waiting to hear back from lawyer Robert Hilliard, who filed a lawsuit on behalf of two Corpus Christie residents after their Toyota accelerated out of control and crashed. We'll be sure to update this post if Hilliard gets back to us.

However, Hilliard didn't believe that the couple in his lawsuit were victims of faulty gas pedals.

"It seems so unlikely that your car has a ghost under the hood and has a mind of its own, which is what it feels like and is frightening to imagine," Hilliard told Hair Balls in February. "Everyone's worst nightmare is a runaway car, whether you're behind the wheel or your child is crossing the road and a runaway car is barreling down on your child. Toyota has a very serious, life-threatening issue that they have not been open and forthright about."


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