Toyota Litigation At Full Throttle
By Christian Nolan
February 22, 2010
After a major car manufacturer admits to defects in its line of automobiles, it’s only a matter of time before the products liability lawyers shift into gear.
As such, class action lawsuits are seemingly being filed daily across the country against Toyota after reports of sudden acceleration in many of its popular vehicle models, including the Camry and Lexus.
The complaints, spearheaded by a national Toyota Consumer Law Firm Consortium led by Northeastern University Law School professor P. Tim Howard, all allege that Toyota’s failure to disclose the accelerator problem amounted to fraud and that the vehicles’ values have dropped considerably.
“People are afraid to use (their Toyota) or that it’ll turn into a paranormal experience,” said Howard.
Connecticut is part of the legal action. So far, one federal lawsuit has been filed as part of the consortium and assigned to Judge Stefan Underhill in Bridgeport, said Howard.
The suit, which seeks class action certification, was filed by Bloomfield solo attorney Shawn Council on behalf of Toyota owner Nimishabahen Patel.
Council’s complaint alleges breach of implied and express warranty, as well as unjust enrichment, in seeking more than $1 billion in damages.
Council did not return repeated calls for comment.
Howard said he expects all of his group’s Toyota claims to be lumped together and go before a multi-district litigation panel, which would then assign the case to trial in one particular federal jurisdiction. He said an MDL hearing was scheduled for March 25.
A handful of other lawsuits nationally so far have been filed on behalf of people injured, or whose family members were killed, when their Toyotas accelerated without warning. Additional law firms planned shareholder suits against Toyota, whose stock value has dropped beneath the weight of the negative publicity.
Toyota announced last month it would stop selling eight models because of accelerator pedals that can stick in the depressed position, and the company has recalled 6.5 million vehicles.
“Toyota will experience some pain from this process,” said Howard, who is also a Florida litigator. “And it’s our job to inflict it.”
Other lawyers in Connecticut are monitoring the activity and speaking with clients whose past auto accidents may not have been what they seemed at the time.
“Toyota has historically blamed operators for the problem,” said William M. Bloss, of Koskoff, Koskoff & Bieder in Bridgeport. Bloss said the National Highway Transportation Safety Administration had investigated Toyota from 2004 to 2007 but ultimately found no wrongdoing.
Toyota’s company line was that “the operator just hit the gas instead of the brake and it was the operator’s fault,” Bloss said. “They were able to convince the federal government of that…but now [Toyota] is acknowledging a serious design flaw in their accelerator system.”
Bloss said he is currently investigating one possible lawsuit against Toyota. He expects some cases to be filed in state courts as part of the Connecticut Product Liability Act if plaintiffs name a local dealership in the suit.
Bloss noted that completed auto accident claims with an insurance company may not preclude Toyota owners from filing a claim against Toyota. The key is to prove a defective Toyota was the cause of the crash.
“It’s causing [lawyers] to actually go back through their files and reconsider prior cases because I don’t think anybody a year ago was able to grasp the depth of the problem here,” said Bloss.
But that strategy presents challenges, Bloss said, and lawyers and their clients must follow certain steps.
First, lawyers must stay connected to national groups gathering daily information about Toyota recalls, which Bloss does as a member of the national Attorneys Information Exchange Group.
From there, he said, tell clients to “preserve the car. If it’s scrapped, that becomes very problematic.”
Products liability lawyer Donn A. Swift, of Lynch, Traub, Keefe & Errante in New Haven, agreed. He said if there’s no car, there’s no evidence.
“It’s very hard to have a products case without the product,” said Swift. “And if you have the product and it’s been repaired, (Toyota representatives) will say, ‘We don’t know what (the car) was like.’”
Swift, whose firm’s web site has a notice urging Toyota “victims” to call them, said lawyers would then have to try to find “a paper trail.” He said the ideal scenario is to find documentation in the repair paperwork that mentions a symptom of the problem, such as a gas pedal that sticks.
Another key, Bloss said, is to leave untouched the black box—or the event data recorder—found in newer vehicles unless an expert is present.
Similar to the black box in an airplane, a vehicle’s black box measures everything from speed acceleration to seatbelt usage.
“Make sure the [black box] data isn’t downloaded without a protocol on how to do it and without your expert there,” said Bloss. “Toyota might want to [download the data] and police may let them or the insurance company might let them.”
‘Not Jumping The Gun’
Lemon law attorney Sergei Lemberg, of Lemberg & Associates in Stamford, has made a career out of challenging automakers selling defective products, but he isn’t yet pursuing any litigation against Toyota.
Lemberg explained that as part of the lemon law, car owners must demonstrate that the defect hasn’t been fixed in 30 days. He said colleagues of his in other states have filed some lawsuits on those grounds, but due to the recalls, Lemberg doesn’t think that’s such a good idea.
“To bring a lemon law claim against a manufacturer on the assertion that the vehicle is defective I think is a little aggressive because the manufacturers are seemingly trying to fix it,” said Lemberg. “And until they fail to fix it…I don’t frankly know if the client I have can show the car is defective. Maybe other cars such as this are defective. But I’m not jumping the gun trying to sue Toyota.”
And not everyone thinks that Howard, the consortium leader, and the group of lawsuits seeking multiple billions of dollars will succeed.
“These kinds of lawsuits will have a rough time in court,” said James A. Henderson Jr., a professor at Cornell Law School who specializes in torts and products liability. “Courts will dismiss them. And in the long run, not very much will come of it.”
Despite the fact the lawsuits do not allege any physical injury and Toyota is working to fix the vehicles, Howard believes he still has a strong claim.
“There are damages among consumers because, no matter what happens here, the cars that people bought will be worth less, whether there’s a quick fix or a long fix,” said Howard.