U.S. judge sets newly merged Toyota suits in motion

LOS ANGELES Thu Apr 15, 2010 8:01pm EDT

A lawyer goes over an information packet as he attends a conference to strategize on how best to sue Toyota Motor Corp. at a hotel in downtown San Diego, California March 24, 2010. REUTERS/Mike Blake

A lawyer goes over an information packet as he attends a conference to strategize on how best to sue Toyota Motor Corp. at a hotel in downtown San Diego, California March 24, 2010.

Credit: Reuters/Mike Blake

LOS ANGELES (Reuters) - The federal judge handling scores of lawsuits against Toyota Motor Corp over cars that raced out of control has set the first court hearing on the combined litigation for next month.

Lawyers for Toyota will face off May 13 before U.S. District Judge James Selna in Santa Ana, California, against attorneys representing over 100 lawsuits consisting of consumer fraud class actions and personal injury claims against the Japanese automaker.

Some lawyers estimate Toyota faces potential civil liability of more than $10 billion as it struggles to contain an auto-safety crisis that has tarnished its public image.

The recent addition of demands for full refunds to U.S. owners of recalled Toyota vehicles as part of consumer protection cases filed in 12 states could raise the legal stakes even higher for the car company.

Selna also designated counsel for the initial phase of the proceedings, naming three prominent trial lawyers and their firms with experience ranging from big tobacco litigation to the Enron Corp bankruptcy and claims arising from the Exxon Valdez oil spill.

Steve Berman of the Seattle-based firm Hagens Berman Sobel Shapiro as well as Marc Seltzer of the Los Angeles firm Susman Godfrey and Elizabeth Cabraser, a founding partner of Lieff Cabraser Heimann & Bernstein in San Francisco were named co-lead counsel by the judge.

LEGAL TEAM TAKES SHAPE

While Selna said "these temporary designations are not a precursor of future appointments," the lawyers' selection for the first phase sets them apart from dozens of others expected to apply for permanent lead roles in the litigation.

"It definitely demonstrates the court has respect for them," said Richard Arsenault, of the Louisiana-based firm Neblett, Beard & Arsenault, who co-chaired a legal conference on the Toyota litigation last month in San Diego.

Arsenault said judges presiding over major consolidations of complex legal claims typically name five to 20 lawyers to manage the plaintiffs' case.

Contenders were given until April 30 to apply, and Selna planned to make additional appointments at the May 13 hearing.

April 30 is also the deadline for lawyers to submit a preliminary report outlining a proposed organizational structure for the legal teams, the basic facts of the case, key issues in dispute and main subject areas for discovery.

Selna also named defense attorney Cari Dawson of the Atlanta firm Alston & Byrd to head up Toyota's legal team.

The process of consolidating lawsuits is another step for the U.S. legal system in confronting a torrent of civil litigation in federal courts related to the problems with unintended acceleration in Toyota cars, trucks and SUVs.

Complaints of runaway automobiles and other safety issues have led to the recall of more than 8.5 million Toyota vehicles worldwide, most for repairs of ill-fitting floor mats and sticking gas pedals the automaker blames for surging engines.

Many of the lawsuits suggest the problem is rooted in an as-yet unidentified electronic glitch, which Toyota has vehemently denied.

Unintended acceleration alone has been linked to more than 50 crash deaths and dozens of injuries in Toyota and its luxury Lexus vehicles under investigation over the past decade.

By one count presented in court last month, at least 138 federal lawsuits had been filed against Toyota, but Arsenault said the number was now approaching 200. Many more were brought in various state courts and are not part of the consolidated federal litigation.

The bulk of federal cases are class actions on behalf of consumers seeking compensation for diminished resale value of their cars as a result of the recalls.

Such cases filed in 12 states by Berman's law firm have been updated during the past month with new claims that owners of recalled Toyota vehicles are entitled to full refunds based on breach of warranty and other misdeeds alleged against the automaker.

Berman said the refund claims "absolutely" would be included the combined consumer litigation going forward.

The case is: In re: Toyota Motor Corp Unintended Acceleration Marketing, Sales Practices, and Product Liability Litigation, U.S. District Court, Central District of California, No. 10-ml-02151.

(Reporting by Steve Gorman, editing by Leslie Gevirtz)

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Comments (2)
Toyota has so much work to do to get Americans liking their product again

Apr 15, 2010 11:36pm EDT  --  Report as abuse
GIZMO_69 wrote:
Toyota has been able to get some political support by casting itself as having a strong domestic presence, with operations creating jobs for lots of Americans, largely in states where the Big 3 of Detroit and the UAW have not been so much of a force, presumably resulting in lower labor costs and better labor relations, along with lower pension and health care costs due to a younger work force.

But yesterday I noticed long rows of new 2010 Priuses on dealer lots, all indicating 100% Japanese origin, all the parts, all the assembly, all the everything, in Japan, the land of the rising sun. This might pass for quite a while since these stickers are removed before delivery to a customer, so many might not ever notice.

How long does Toyota think this game can go on?

Apr 16, 2010 6:23pm EDT  --  Report as abuse
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