Facing the potential of paying millions of dollars in punitive damages after losing an Oklahoma sudden-acceleration lawsuit, Toyota Motor Corp. quickly reached a settlement with the plaintiffs.
On Thursday, an Oklahoma City jury found that faulty electronic systems in a Camry sedan caused it to accelerate out of control and crash, killing one woman and injuring another.
The jury ordered Toyota to pay $1.5 million in compensatory damages to the driver of the vehicle, Jean Bookout, and an additional $1.5 million to the family of Barbara Schwarz, who was killed in the crash.
The jury was to rule on punitive damages Friday. The settlement precludes that.
“Once the jury found that Toyota acted with reckless disregard, it seemed clear that the jury would award punitive damages and possibly in a substantial amount,” said Carl Tobias, a University of Richmond law professor and product liability expert.
“Toyota wanted to avoid the adverse publicity and additional momentum for other plaintiffs that could be associated with a large punitive damage award on top of a substantial compensatory damage award,” Tobias said.
The decision, handed down late Thursday, marked the first time that the Japanese automaker has been found responsible for sudden acceleration in one of its cars.
After a brief deliberation at the end of a nearly three-week trial, the jury decided that software in the 2005 Camry’s electronic throttle system was defective and caused the accident in September 2007.
After the verdict was announced, Toyota approached attorneys for the plaintiffs and asked for a settlement. The parties agreed to terms for a confidential amount before the jury considered punitive damages.
“While we strongly disagree with the verdict, we are satisfied that the parties reached a mutually acceptable agreement to settle this case,” said Toyota spokeswoman Carly Schaffner. “We remain committed to providing our customers with safe and reliable vehicles, and we will continue to defend our products vigorously at trial in other legal venues.”
However, the attorney for Bookout and Schwarz’s heirs said there was a problem in some Toyota vehicles that still required a fix.
“We are fully convinced that Toyota’s conduct from the time the electronic throttle control system was designed has been shameful,” said attorney J. Cole Portis. “We appreciate that the jury had the courage to let Toyota and the public know that Toyota was reckless. Hopefully, Toyota will recall all of their questionable vehicles and install a computer that will be safe.”
Toyota has recalled millions of vehicles to fix issues with gas pedals and floor mats that it said caused sudden-acceleration incidents. It also has blamed unexpected accelerations on drivers stepping on the gas pedal instead of the brakes.
The automaker’s top executives have testified before several congressional committees investigating the problem. Toyota also paid more than $65 million in fines for violations of federal vehicle safety laws.
Toyota has settled a number of sudden-acceleration lawsuits out of court, including a $10 million deal reached in 2010 with the survivors of a California Highway patrolman and three family members who were killed in a runaway Lexus ES outside San Diego.
Late last year, the company agreed to pay $1.6 billion to settle a class-action case brought by thousands of Toyota owners who contended that the sudden-acceleration problem damaged the value of their vehicles.
Toyota still faces hundreds of personal injury and wrongful death lawsuits related to sudden acceleration.