Toyota Owners Seek Legal Action to Recoup Lost Resale Values
BOSTON — As Toyota owners see the value of their vehicles drop in connection with the automaker's recent recalls, many have sought legal action.
Many are turning to Attorneys Toyota Action Consortium, which is a federation of consumer law firms filing lawsuits against the automaker. The group has already grown to 22 law firms, covering 16 states. Officials said more states are expected to be covered soon.
The effort is coordinated by P. Tim Howard, a professor of law and policy at Northeastern University. He coordinated the legal team in the Florida tobacco lawsuit in the 1990s, which led to a $20 billion settlement with the State of Florida and a national settlement of $250 billion. He is also currently co-counsel, representing 3,600 victims of cigarette-related disease in Florida.
"This is the strongest and largest case for economic damages to American consumers we've ever had," said Howard, who also practices consumer law at Howard & Associates in Tallahassee, Fla. "Major used-car valuation services like Edmunds, NADA and Kelley Blue Book have already downgraded resale value by as much as 3.5 percent, and consumers can expect an additional decrease up to 6 percent.
"As a result, Toyota owners have been robbed of their investment, along with their ability to trade in these vehicles rather than submit to hasty and questionable repairs," he claimed. "In the meantime, they have also lost the use of their car. That's economic damage, plan and simple."
Along with other Florida attorneys, Howard filed one of the consortium's first lawsuits for $1 billion in damages in Florida in early February.
In addition to Howard, other ATAC members include Stephen Sheller and Brian McCormick Jr., of Sheller, P.C., in Philadelphia, who have already filed a case in Pennsylvania and are planning to file a case in New Jersey immediately.
In California, ATAC is led by Larry Gornick, of Levin Simes Kaiser & Gornick in San Francisco. His previous work has involved defective products, toxic torts and more. The team is also working with several law firms in Los Angeles that have filed previous Toyota class actions.
In New York, litigation is headed up by attorney James Haggerty, who has a personal involvement. Apparently, in early 2009, he says his mother-in-law was nearly killed in a crash involving a 2005 Toyota Camry with sudden acceleration the suspected cause.
The ATAC team is also preparing cases involving the brake issues with the Toyota Prius.
A court hearing on whether national class action cases will be consolidated is expected for March 25 before a multi-district panel in the U.S. District Court in San Diego.
Toyota Offers Recall Update
According to Toyota, more than 50,000 vehicles are being fixed a day.
"All Toyota dealers nationwide have received the parts, the tools and training they need, and repairs for vehicles involved are very much under way. Our dealers are repairing over 50,000 vehicles a day — with hundreds of thousands of vehicles already fixed since the recalls were announced," said Bob Carter, group vice president and general manager of the Toyota division.
"Toyota vehicles are very safe. The conditions that have been reported throughout the media are extremely rare, but I understand the concern and we are working closely with our consumers to delivery the repairs quickly, effectively and conveniently as possible," he added.
In other company news, Toyota said that on Feb. 8, a federal grand jury in the Southern District of New York issued a subpoena that requested the automaker and its subsidiaries to produce certain documents related to unintended acceleration of Toyota vehicles and the braking system of the Prius.
On Feb. 19, Toyota Motor Corp. and Toyota Motor Sales, U.S.A., received a voluntary request and a subpoena, respectively, from the Los Angeles office of the United States Securities and Exchange Commission, seeking production of certain documents including those related to unintended acceleration of Toyota vehicles and the company's disclosure policies and practices.
TMC and TMS intend to cooperate with the investigations and are currently preparing their responses, officials indicated.
In respect to a memo that is apparently circulating, which boasts about the cost savings Toyota had (about $100 million) when it reached a deal with the U.S. government earlier over the floor mat issue, the automaker said, "Our first priority is the safety of our customers and to conclude otherwise on the basis of one internal presentation is wrong.
"Our values have always been to put the customer first and ensure the highest levels of safety and quality. Our recently announced top-to-bottom quality review of all company operations, along with new quality initiatives and a renewed commitment to transparency, are all designed to reaffirm these values," officials said in a statement.
As TMS and TMC executives, including Akio Toyoda, prepare to visit Capitol Hill this week to testity on the recalls, Toyota's dealers are also getting involved.
Starting this morning, representatives from Toyota dealerships throughout the country will convene on Capitol Hill to voice their commitment to the automaker and outline their efforts on the frontlines to help ensure a successful vehicle recall and repair effort.
Dealers are expected to describe the steps service staff and mechanics are taking "to ensure local Toyota owners get the prompt, thorough service they deserve and have come to expect."
Plant employees will also be on hand to express their support for Toyota in advance of a House Committee on Oversight and Government Reform hearing on Toyota gas pedals.