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Toyota will pay $16 million Dollars to Settle Lawsuit Filed by Orange County DA

April 07, 2013

Posted in Product Liability

709119_tachometerThe Orange County District Attorney, Tony Rackauckas, announced that Toyota will pay $16 million dollars in settlement for concealing the facts during a recent recall in violation of California Consumer Protection Laws. In 2010, Rackauckas filed a lawsuit against Toyota for fraudulent business practices and sought $2,500 for each violation. Subsequently, Rackauckas retained the Orange County law firm Robinson, Calcagnie & Robinson, to litigate the matter on a contingency basis.  Many speculate that this may be the first time a County District Attorney has filed a civil suit against an automaker.

In the 2010 lawsuit filed against Toyota, Rackauckas alleged that:

  • Toyota knowingly sold defective vehicles that accelerate suddenly;
  • These defective vehicles were sold to Californians over last several years before the recall;
  • Toyota knew about the issue of unintended sudden acceleration caused by the floor mat and the “sticky” gas paddle, but failed to disclose;
  • Toyota made a business decision to sell or lease defective vehicles in California instead of recalling them;
  • Toyota took affirmative steps to hide defects in the cars they sold; and
  • California consumers did not know about the defects, and they were harmed by Toyota’s action, as the value of their vehicles is significantly reduced because of the defect.

Now, three years after Rackauckas filed the lawsuit, it has been settled for a total of $16 million. Distribution of the settlement will be as follows: $8 million will be distributed to the Orange County Gang Reduction Intervention Partnership; $4 million will fund the Orange County DA’s effort to fight economic crimes; and the remaining $4 million will go toward paying the court costs and fees of the outside counsel retained by Rackauckas to handle this litigation.

Ironically, although Rackauckas is representing the State of the California and suing on behalf of residents of Orange County for the unfair business practices of Toyota, Orange County “consumers” will not see a dime from the settlement. All settlement money will to Rackauckas’s offices to fund his various projects. It is as if the Orange County District Attorney’s Office is gaining additional departmental funding by filing a civil suit against a private company. Government suits against private companies to recover civil penalties are common for federal and state agencies, but this is rare for county-level prosecuting agencies. However, if we look at the bright side, at least the projects that will directly benefit from the lawsuit settlement deal with fighting crime.

Injuries caused while using a product can often be serious and are often catastrophic. Each year, about 34 million people are injured or killed because of product-related accidents, and in the age group of 1 to 36, injuries caused by product-related accidents outnumber deaths from cancer, heart disease, and other such ailments. The costs for dealing with product-related injuries are enormous, about $12 billion a year.

If you have been injured while using a product, you need to talk to an experienced litigator and trial attorney who knows the area of product liability. For more information, call the Law Offices of Tony T. Liu to schedule an appointment, at (714) 415-2007.