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'Sticky' gas pedal settlement will cost Toyota $1.1B

Keywords: Tags  Toyota USA, class-actionl lawsuits, accelerator problem, settlement offer, Christopher Reynolds, Corinna Petry

CHICAGO — Toyota Motor Corp. has agreed to settle class-action lawsuits alleging that certain models had a "sticky" gas pedal that resulted in unintentional acceleration.

"This was a difficult decision, especially because reliable scientific evidence and multiple independent evaluations have confirmed the safety of Toyota’s electronic throttle control systems," said Christopher P. Reynolds, group vice president and general counsel at Toyota Motor Sales USA. "However, turning the page on this legal issue is in the best interests of the company, our employees, our dealers and our customers."

If the settlement is approved by the judge supervising multidistrict litigation pending in U.S. District Court in California, Toyota will launch a new customer-support program that will provide supplemental warranty coverage for certain vehicle components and retrofit additional non-hybrid vehicle models subject to the floor mat recall with a free brake override system to provide an added measure of confidence.

Toyota also will make cash payments to eligible customers who sold or turned in their leased vehicles during 2009 and 2010 and to eligible current owners and lessees who will not be offered the brake override system.

The proposed settlement also would establish additional driver education programs and fund new research into advanced safety technologies, Toyota said.

Toyota said it will take a one-time, $1.1-billion pre-tax charge against earnings to cover the estimated cost of the settlement.

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