Friday, May 25, 2018
Business

Toyota may pay $1 billion fine to settle criminal investigation

Here's how Toyota plans to finally put the sudden-acceleration issue to rest: pull out the checkbook.

The automaker is reportedly close to paying a $1 billion fine to settle a four-year federal criminal investigation into whether it properly reported safety complaints to regulators. Meanwhile, Toyota's lawyers are in settlement talks over hundreds of civil lawsuits alleging wrongful deaths or injuries, potentially adding hundreds of millions to the tab.

Previously, Toyota agreed to pay $1.6 billion to settle a class-action case brought by thousands of Toyota owners who contended sudden-acceleration problems reduced their vehicles' value.

The automaker has repeatedly denied any serious safety defect that caused its cars to take off at high speeds, causing wrecks that killed or injured occupants. Toyota appeared ready for a protracted legal battle to fight hundreds of legal claims to the contrary.

Now, Toyota appears ready to pay what it takes to move the story off front pages and newscasts.

"Toyota is trying to put this entire episode behind it," said John Goldberg, a Harvard Law School professor and product liability expert.

Investors and shareholders generally react positively to "closure," even when that comes at a price, Goldberg said.

"Given that the allegations of at least some injury victims were credible, and given the attention of government regulators, Toyota wasn't going to be able to resolve things without negotiating substantial settlements," he said.

The potential for a $1 billion settlement of the criminal investigation was first reported by the Wall Street Journal. Citing unnamed sources, the newspaper reported that an agreement with the U.S. Attorney's Office in New York could come within weeks. But the deal is not done and could change, according to the Journal.

Toyota confirmed the talks, issuing a statement that it continues to cooperate with the U.S. Attorney's Office. "In the nearly four years since this inquiry began, we have made fundamental changes to become a more responsive and customer-focused organization, and we are committed to continued improvements."

Automotive safety advocates welcomed news of a potentially huge fine in the criminal inquiry.

It is "enough to make even Toyota flinch," said Clarence Ditlow, executive director of the Center for Auto Safety.

"Even today, no one knows what Toyota withheld from the National Highway Traffic Safety Administration that could have proven beyond a reasonable doubt that sudden acceleration is due to vehicle design, not driver error," Ditlow said. "Only billion-dollar fines and criminal prosecutions can stop auto industry coverups of deadly vehicle defects."

Ditlow said the threat of criminal penalties gave the U.S. attorney more leverage than NHTSA, which regulates auto safety, to make Toyota pay such a large fine.

Toyota has faced sudden-acceleration complaints since 2009, after a California Highway Patrol officer and his family were killed when a Lexus ES crashed outside San Diego. That crash is thought to have been caused by a floor mat jamming the gas pedal in the open position, but the car was too badly damaged to be sure.

Comments
Five members of 69ers motorcycle gang indicted on federal charges

Five members of 69ers motorcycle gang indicted on federal charges

Last year three members of the 69ers Motorcycle Club gang were implicated in the execution of a rival gang leader in the middle of rush hour traffic in Pasco County.Now those three and two other 69ers members have been indicted on federal charges tha...
Updated: 2 hours ago
With makeover, ZooTampa at Lowry Park takes a page from the theme parks

With makeover, ZooTampa at Lowry Park takes a page from the theme parks

TAMPA — Behind the construction walls near the carousel at ZooTampa at Lowry Park, hammers, saws and power drills made a racket in the blazing Friday heat. A raft full of 100-pound water jugs took test trips on the new Roaring Springs ride set ...
Updated: 3 hours ago
U.S. news outlets block European readers over new privacy rules

U.S. news outlets block European readers over new privacy rules

LONDON ó U.S. news outlets including The Chicago Tribune, The Los Angeles Times, The Orlando Sentinel and The Arizona Daily Star abruptly blocked access to their websites from Europe on Friday, choosing to black out readers rather than comply with a ...
Updated: 6 hours ago
Tampa Electric appeals OSHA findings for October accident

Tampa Electric appeals OSHA findings for October accident

TAMPA ó Tampa Electric Co. is appealing a recent citation by federal regulators. The Occupational Safety and Health Administration hit the utility with a $76,050 fine and a "serious" violation in April following its investigation into an accident in ...
Updated: 7 hours ago
Fiat Chrysler recalls 4.8 million cars, warning owners: Donít use the cruise control

Fiat Chrysler recalls 4.8 million cars, warning owners: Donít use the cruise control

Associated PressDETROIT ó Fiat Chrysler is recalling 4.8 million vehicles in the U.S. because in rare but terrifying circumstances, drivers may not be able to turn off the cruise control. The company is warning owners not to use cruise control until...
Updated: 9 hours ago
Federal Reserve chairman warns his agency must be free from political pressure

Federal Reserve chairman warns his agency must be free from political pressure

Associated PressFederal Reserve Chairman Jerome Powell warned Friday that the Fedís independence from political pressure must be respected if it is to succeed in controlling inflation, maximizing employment and regulating the financial system. His re...
Updated: 9 hours ago
Restaurants like Ford’s Garage use the experience to get you in the door

Restaurants like Ford’s Garage use the experience to get you in the door

Tim Butler’s first car was a Ford Model A pick-up truck — a pearl fawn and cherry red pick-up he got his senior year in high school from his dad, who renovates antique cars. That’s why as Butler waited for a table at the Ford’...
Updated: 9 hours ago
St. Petersburg man fined $507,513 in penny stock scheme

St. Petersburg man fined $507,513 in penny stock scheme

TAMPA ó A St. Petersburg man was fined $507,513 and permanently barred from participating in the offering of a penny stock in a case involving a scheme to manipulate the price of Aureus, a penny stock company incorporated in Nevada, officials said Fr...
Updated: 10 hours ago
Broadcomís CEO tops highest-paid list with a $103 million payout

Broadcomís CEO tops highest-paid list with a $103 million payout

Times staff and wiresNEW YORK ó Chief executives at the biggest public companies got an 8.5 percent raise last year, bringing the median pay package for CEOs to $11.7 million. Across the S&P 500, compensation for CEOs is often hundreds of times highe...
Updated: 10 hours ago
Denis Phillips, hurricane season guru, talks his signature beer, suspenders and Rule #7

Denis Phillips, hurricane season guru, talks his signature beer, suspenders and Rule #7

SAFETY HARBOR ó Denis Phillips cracks a pop-top and pulls a can that looks a lot like him to his lips."Itís got that citrusy feel to it," he says. "Which is a Florida thing. Thatís not bad." Indeed, thereís a grapefruit finish to Rule #7 Hurricane Sa...
Published: 05/25/18