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Toyota Secretly Bought Back Defective Cars, Claims Lawsuit

Maker denies it hid defects.

by on Oct.29, 2010

Revised lawsuit cites internal documents, including one in which a Toyota tech experienced unexplained problems with a 2009 Tacoma.

Toyota secretly repurchased vehicles from consumers when it found their cars had sudden acceleration problems, hoping to hide the defects from federal regulators, the media and the public, claims a revised lawsuit.

While it is not entirely uncommon for a maker to occasionally buy back vehicles that have problems, the revised lawsuit filed in U.S. District Court in Santa Ana, a Los Angeles suburb, claims the Japanese maker specifically targeted vehicles that it found did have problems with sudden acceleration.  And plaintiffs’ attorney Steve Berman contends that part of the repurchase agreement was a confidentiality agreement requiring owners to keep quiet and not sue the maker.

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Toyota largely denies the claims, saying only that on some occasions it did agree to repurchase vehicles from consumers, requiring that they then agree not to file a liability claim against the company.

The maker says it was, “unable to duplicate the condition (the claim of a sudden acceleration incident) and the vehicles were repurchased from the customers for further engineering analysis,” not to hide the defect.  It also says it reported the two vehicles in question to the National Highway Traffic Safety Administration, or NHTSA.

The maker says it looks forward to defending itself in court and that is clearly where the case is heading.

In the revised court documents, plaintiffs’ attorneys claim they have documentation proving Toyota technicians or representatives were able to duplicate the sudden acceleration problems.  And they cite at least one instance where the maker hid such evidence from the government.

Over the summer, the courts forced a consolidation of scores of individual lawsuits related to the sudden acceleration issue, many claiming that the problem has resulted in diminished resale value for Toyota vehicles.  The litigants argue that Toyota has known it had a problem for as long as a decade and long delayed taking the appropriate actions to correct the problem.

The issue of sudden – or, as some prefer, unintended – acceleration has plagued dozens of automakers in recent decades.  The issue nearly sank Audi, 20 years ago, which only slowly recovered after the German maker was given a clean bill of health by federal investigators.

In Toyota’s case, a fiery accident involving a runaway Lexus that killed a California highway patrol officer and members of his family finally forced action by the maker.  It issued its first recall in October 2009 to deal with loose floor mats that could jam the accelerator pedal.  The following January, Toyota ordered another recall to replace or repair potentially sticky accelerator pedals.

Since then, the maker has been targeted in a series of Congressional hearings and later agreed to pay a record $16.4 million fine for delays in reporting the accelerator pedal problem, as required, to NHTSA.

But by some estimates Toyota could be facing billions of dollars in liability in the courtroom should any of the outstanding cases go against it.

While Toyota has acknowledged that there could be instances of sudden acceleration from jammed mats or sticky accelerators, it has repeatedly ruled out the possibility of yet-unidentified electronic problems with engine control systems.  A preliminary finding by the government has echoed that assumption based on preliminary analysis of the black boxes found on Toyota vehicles reported to have experienced sudden acceleration.

In those cases, the maker claims, the issue was one of driver error, such as a motorist inadvertently pressing the throttle pedal instead of the brake.

Nonetheless, the revised lawsuit cites a number of internal Toyota documents which support the claim of unknown electronic gremlins.  In one 2009 case, a Toyota service manager reports an incident involving a Tacoma pickup that suddenly raced from 70 to 95 mph, while being tested, “with no pedal contact,” and no reason to suspect either loose carpets or a sticky accelerator.

In all, Toyota has so far recalled 5.4 million vehicles to address the various known sudden acceleration defects. Earlier this month, the maker’s U.S. second-in-command, Don Esmond, said that nearly 80% of those vehicles have now been repaired by Toyota service technicians.

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