Seven insurers sue Toyota over acceleration claims
Seven automobile insurance firms have followed Allstate Insurance Co in suing Toyota Motor Corp to recover money they paid in claims for car crashes blamed on unintended acceleration of Toyota vehicles.
January 05, 2011 / 09:32 IST
Seven automobile insurance firms have followed Allstate Insurance Co in suing Toyota Motor Corp to recover money they paid in claims for car crashes blamed on unintended acceleration of Toyota vehicles.
The insurers' court action has opened a new front in US civil litigation mounting against the Japanese automaker as the company battles to move beyond an auto safety crisis sparked by wide-ranging complaints of Toyotas speeding out of control.Acceleration problems in Toyotas led to renewed scrutiny from federal regulators, several congressional hearings and a series of worldwide recalls that damaged Toyota's reputation for quality.The National Highway Traffic Safety Administration is investigating reports that as many as 89 crash deaths since 2000 may be linked to sudden acceleration in Toyotas and the company's luxury-line Lexus vehicles.Toyota also faces an estimated USD 10 billion in potential civil liability in US courts for consumer fraud, personal injury and wrongful death claims stemming from acceleration complaints.The latest lawsuits, filed Thursday in Los Angeles County Superior Court, echo claims in separate cases pending elsewhere that Toyota long ignored and hid a defect that causes some of its engines to surge out of control, and failed to install a brake-override system that would have prevented accidents.The seven insurers are collectively seeking compensatory damages of at least USD 188,000, a fraction of the USD 3 million in losses sought by Allstate in its own filing in October for itself and affiliates.The seven latest companies to bring such subrogation actions against Toyota are: American Automobile Insurance Co, Fireman's Fund Insurance Co, National Surety Corp, Ameriprise Insurance Co, IDS Property Casualty Insurance Co, Motorists Mutual Insurance Co and American Hardware Mutual Insurance Co.Their suits, brought in three separate filings, come nearly two weeks after it was disclosed that Toyota agreed to pay USD 10 million to settle legal claims from the family of a California state trooper and three relatives whose fatal car wreck in 2009 helped trigger the automaker's recalls.Those recalls, encompassing 5.4 million US vehicles, were ordered by Toyota for repairs of ill-fitting floor mats that can jam the accelerator and for gas pedals that did not spring back as designed.Toyota has steadfastly denied allegations raised in much of the litigation it faces, including the latest insurer claims, that an as-yet unidentified electronic glitch is to blame for its acceleration problems.The automaker did not immediately respond to a Reuters request for comment on the insurers' lawsuits.According to the Los Angeles Times, Toyota issued a statement this seek saying that the latest lawsuits are without merit and that such disputes "are common between insurers and automakers." Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
