Toyota Agrees to Pay Record $1.2 Billion Fine for Covering-Up Safety Defects in its Vehicles

On March 19, 2014, the United States Attorney General, Eric Holder, announced a record breaking fine imposed upon Toyota Motor Corporation regarding its cover-up of safety defects in Toyota vehicles that led to widespread incidents of unintended vehicle acceleration. As noted by Attorney General Holder, the U.S. Justice Department’s criminal investigation revealed that, “rather than promptly disclosing and correcting safety issues about which they were aware, Toyota made misleading public statements to consumers and gave inaccurate facts to Members of Congress.”  [The entirety of Attorney General Holder’s March 19, 2014 remarks may be found at http://www.justice.gov/iso/opa/ag/speeches/2014/ag-speech-140319.html].  

The Justice Department further noted that Toyota was aware that there was a serious safety issue that led to widespread documented incidents and tragic accidents, some of which resulted in death. To resolve the investigation, Toyota agreed to pay a $1.2 billion fine, which as noted by Attorney General Holder “represents the largest criminal penalty imposed on a car company in U.S. history.” The fine was imposed to not only punish Toyota for its illegal and deceptive conduct but also to send a message that “other car companies should not repeat Toyota’s mistake,” remarked Holder. 

In his press conference announcing this record breaking fine, Attorney General Holder made clear that the general public should have the right to feel confident that they are safe when they get behind the wheel. Moreover, car manufacturers should be transparent with the information that they learn about their vehicles and not delay in announcing important safety recalls. By violating these basic principles, Attorney General Holder noted,

“Put simply, Toyota’s conduct was shameful. It showed a blatant disregard for systems and laws designed to look after the safety of consumers. By the company’s own admission, it protected its brand ahead of its own customers. This constitutes a clear and reprehensible abuse of the public trust.”

Importantly, the Justice Department’s announcement reaffirms that the federal government is committed to making sure that motor vehicles are safe. This commitment has been long rooted not only in the actions of federal agencies charged with ensuring the public safety, but also the United States Congress has enacted laws to further protect the public. For instance, in 1975, Congress enacted the Magnuson-Moss Warranty Act, a consumer protection remedial statute aimed at making consumer warranties more readily enforceable. Per the federal Act, warrantors of consumer products, including cars, trucks, vans, SUV’s, motorcycles, etc., must comply with the obligations in their warranties within a reasonable time. Therefore, automobile manufacturers do not have an unlimited amount of time to fix defects and non-conformities in their vehicles.  Additionally, every state has enacted their own lemon law provisions which supplement the protections afforded by the federal Magnuson-Moss Warranty Act. Notably, these laws generally provide that should the consumer prevail in advancing a claim against an automobile manufacturer for failing to repair a defect that the automobile manufacturer must pay for the consumer’s attorneys’ fees and costs. 

Accordingly, whether you have experienced a serious safety defect like those for which Toyota was penalized or any other type of defect in your vehicle, you may have rights under federal or state lemon laws. The experienced attorneys at Krohn and Moss, Ltd. Consumer Law Center ® have successfully handled over 35,000 lemon law claims since 1995. We offer a FREE CASE REVIEW for you to assess whether we can assist you with your lemon car, truck, SUV, or other vehicle and a free and quick Lemon Law case evaluator. Please do not hesitate to contact us toll free at 1-800-875-3666 or visit our website at http://www.yourlemonlawrights.com.