Toyota faces class-action lawsuits

10 March 2010

Car giant Toyota has suffered a fresh blow after US owners filed class-action lawsuits claiming diminished value of their cars due to the global safety recalls.

It has been estimated that the lawsuits could cost the Japanese car maker more than £2 billion. This could prove far more costly if potential payouts for wrongful death and injury cases are also included.

So far, at least 89 class-action lawsuits have been filed in total - all claiming sudden drop in car value.

According to Tom Baker, a University of Pennsylvania law professor, such lawsuits "are more scary for Toyota than the cases where people actually got injured".

He said: "A super-big injury case would be 20 million dollars. But you could have millions of individual car owners who could (each) be owed 1,000 dollars. If I were Toyota, I'd be more worried about those cases."

A panel of federal judges will decide whether to consolidate the cases into a single jurisdiction at a hearing in San Diego, on March 25.

Later a decision will be taken on whether all claims filed by Toyota owners can be combined in a single legal action, known as "certifying a class".

The lawsuits came at a time when the company was already struggling to revive its position in the market, after massive worldwide recalls of its vehicles over the past few months.

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