Federal Appeals Court Strikes Down Toyota Appeal in Acceleration Lawsuit

Aug. 14, 2017—A federal appeals court on Friday broadly upheld a lower court's evidentiary rulings in a trial over a fatal 2006 car crash in Minnesota that resulted in an $11 million verdict against Toyota Motor Corp, according to Reuters.

A three-judge panel of the 8th U.S. Circuit Court of Appeals unanimously ruled the trial judge properly allowed three other owners of 1996 Toyota Camrys, the type of car involved in the crash, to testify about instances in which their cars experienced unintended acceleration.

In July, a prominent and longstanding Toyota dealer, Roger Hogan, and his Toyota dealerships in Claremont and San Juan Capistrano, Calif., filed suit in Orange County Superior Court against Toyota, for fraud and breach of the covenant of good faith and fair dealing. The lawsuit sought recovery of compensatory damages, plus punitive damages.

The lawsuit alleges that following Toyota’s multi-billion dollar safety recall in 2009-2014, Hogan, who had been in business with Toyota for almost 40 years, created a software technology called Autovation. This software, when installed at and utilized by Toyota dealers, enabled the dealer to identify customers with uncompleted safety recalls—many involving dangerous defects such as unintended acceleration—and send them letters offering a fix. The recalls addressed dangerous defects such as “sticky acceleration pedals” and “floor-mat entrapment” that caused deaths and serious injuries. 

According to the lawsuit, Toyota sent out only one recall notice to customers, and many customers, for various reasons, did not receive or ever see the notice.

Also, said Hogan and his attorneys, the system Toyota put in place made it difficult, if not impossible, for dealers to identify open safety recalls when customers brought in their vehicles for service. Thus, per the lawsuit, Toyota was not fixing hundreds of thousands of recalled vehicles, despite hazards jeopardizing customer safety.