Judge rejects most claims in Toyota investor suit
Wednesday, July 13, 2011
LOS ANGELES (AP) — A federal judge has rejected most claims made in a shareholder lawsuit against Toyota Motor Corp. that accused the Japanese automaker of knowing about and hiding purported acceleration problems in some of its vehicles.
U.S. District Judge Dale Fisher said in her July 7 ruling that Japanese law takes precedence, especially since many of those who sued Toyota bought company stock on foreign exchanges.
“This respect for foreign law would be completely subverted if foreign claims were allowed to be piggybacked into virtually every American securities fraud case,” Fisher wrote in her 11-page decision.
Toyota spokeswoman Celeste Migliore said in a statement the company is pleased with the judge’s ruling.
“Although the court has given plaintiffs the opportunity to amend their complaint with respect to the claims under U.S. law only, we believe that any such attempt will result in allegations that remain unsupported by both the facts and law,” Migliore said.
The suit notes Toyota stock dropped about 20 percent in January and February 2010 when the company began recalling some of its models. The Japanese automaker has recalled about 14 million vehicles worldwide and it has paid the U.S. government a record $48.8 million in fines for its handling of three recalls.
Hundreds of lawsuits have been filed against Toyota, claiming economic loss and wrongful death due to sudden acceleration. Those suits are before a federal judge in Orange County and allege a design defect — namely its electronic throttle control system — is responsible for vehicles surging unexpectedly. Toyota has blamed driver error, faulty floor mats and sticky accelerator pedals for the unintended acceleration.
The automaker’s defense was buoyed earlier this year when U.S. regulators said electronic flaws weren’t to blame for unintended acceleration.
The first trials on the acceleration issue are expected to begin in 2013.
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