TOYOTA (dpa-AFX) - A U.S. Court Friday gave its final approval to a near $1.6 billion settlement in a case involving Toyota Motor Corp. (TM) and aggrieved owners whose vehicles were prone to abrupt acceleration that led to a depreciation of the vehicles' value.
According to Hagens Berman, the plaintiffs' counsel, District Court Judge James Selna of the Central District of California hailed the settlement of the case, which was filed in 2010.
The lawsuit charged the trade-in value of Toyota vehicles dipped upon media reports and consumer complaints over a defect that caused the vehicles to abruptly accelerate.
Several lawsuits, filed since 2009, were consolidated in the U.S. District Court in California, and proceeded upon, until a settlement was reached last December.
As per the settlement, Toyota will install a brake-override system in vehicles subject to floor mat entrapment recalls. It will also establish a $250 million fund to compensate current owners not eligible for the aforesaid installation.
Another $250 million fund will be formed to compensate Toyota owners who, at a loss, sold their cars between September 2009, and December 2010.
Hagens Berman said that those who sold their Toyota vehicles at a loss can receive from $125 up to $10,000 depending on the level of depreciation.
The total value of the settlement package is estimated to be about $1.6 billion.
Since the claims emerged, the Japanese automaker has recalled over 14 million vehicles, shocking for a company reputed for its quality. Toyota meanwhile has denied the charges.
Recalls have continued to be a drag on Toyota. In April, the company recalled 1.73 million vehicles due to airbag defects.
Toyota's stock closed Friday at $120.53, down $4.13 or 3.31%, on a volume of 1.3 million shares on the NYSE.
Copyright RTT News/dpa-AFX