Takata Reaches Settlement Agreement with DOJ
Jan. 16, 2017—Takata announced on Friday that it has reached a settlement agreement with the U.S. Department of Justice (DOJ) regarding the company’s previously disclosed issues related to the integrity of Takata’s inflator validation testing and reporting.
This settlement fully resolves the DOJ investigation into Takata and all of its subsidiaries and affiliates, including Takata’s U.S. subsidiary, TK Holdings.
Under the terms of the agreement, which is subject to court approval, Takata agreed to plead guilty to one count of wire fraud for falsifying testing data and reports that were provided to automakers. In addition, the Justice Department also indicted three Takata executives for their involvement.
The company will pay a criminal fine of $25 million and establish a $125 million restitution fund for individuals who suffered or will suffer personal injury caused by the malfunction of a Takata airbag inflator, and who have not already resolved their claims.
Takata will establish an $850 million restitution fund for the benefit of automakers who received falsified testing data and reports or who have purchased airbag inflators from Takata containing phase-stabilized ammonium nitrate.
The company also agreed to enhance its corporate compliance program and appoint an independent monitor, who will report to the DOJ for a period of three years and monitor Takata’s compliance with its legal and ethical obligations.
To address the inflator issues, Takata has increased investment in data integrity and product safety and quality.
Key actions taken by Takata include:
- Implementing improvements to testing protocols and data security, including the creation of a data vault to ensure inflator testing results are reliable and accurate;
- Establishing an independent quality assurance panel led by former Secretary of Transportation Samuel K. Skinner and acted on the Panel’s recommendations;
- Adding more than 100 staff in the TKH quality organization and invested more than $160 million in the inflator group and TKH Safety organization; and
- Investing significant resources to maximize recall completion rates, including launching a targeted digital advertising campaign in the U.S.
Takata urges all consumers to check NHTSA’s www.safercar.gov website and contact their dealers immediately if they discover their vehicle is subject to a recall.