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Is Toyota Telling the Truth About Sudden Acceleration?

Toyota says its problems with sudden unintended acceleration are in the rearview mirror, but newly disclosed documents raise questions that experts say have not yet been answered.

On the day he died, Mark Saylor was doing what he did for a living: driving on a California highway. Only he wasn’t driving his state-issued highway patrol car that day in late August 2009. Nor was he driving his own Lexus 250, which was at the dealer for servicing. He was driving a loaner with his wife, daughter, and brother-in-law on a leisurely family outing northeast of San Diego—until suddenly the car inexplicably took off. And no amount of braking could slow it down. As Saylor frantically tried to gain control, his brother-in-law called 911. “Our accelerator is stuck!” he told the dispatcher. “We’re going 120!”

It wasn’t just the speed that made this so dangerous. He read the sign they were passing: “End freeway one-half mile.” The car was barreling toward a T-shaped intersection. When it got there, it hit another car, flew through a fence, rolled into a field, and burst into flames. The last word before the screams was, “Pray!”

This wasn’t the first time that someone driving a Toyota had experienced sudden unintended acceleration. And it’s not a problem that’s unique to Toyota. But this was the event that Toyota cites as the beginning of its ongoing crisis.

How has it responded? The company has moved aggressively to contain the damage. Shifting floor mats were identified as a primary cause of many of these episodes. The company found that the loaner that the 45-year-old Mark Saylor was driving was equipped with mats that had never been intended for that car. Later, the company fingered accelerator pedals manufactured by a third party as prone to sticking. And Toyota says that many accidents are caused by drivers who inadvertently step on the gas instead of the brake.

As the crisis mounted, the company seemed overmatched. Critics charged that Toyota had sacrificed quality—its traditional strong suit—in a rush to rack up sales. The National Highway Traffic Safety Administration (NHTSA), which had been criticized for years for its willingness to pin sudden acceleration on driver error, suddenly got tough. Toyota recalled more than 8 million cars and paid fines totaling more than $50 million. Litigation, which had slowed down before the Saylor crash, roared back to life, fueled by the recalls and new complaints. And the political pressure, coupled with a Democratic Congress, led to hearings in Washington that drew global attention. Toyota Motor Corporation president Akio Toyoda flew in from Japan to personally face the politicians’ angry questions.

But then everything seemed to calm down. As the company battled two large multidistrict litigation class actions (MDLs) in California, it quietly settled some of the smaller lawsuits, including the one brought by the Saylors’ survivors. The results of several investigations trickled in. Some had been commissioned by Toyota, and tended to include lots of technical data and to focus on floor mats and gas pedals. Then, in 2011, NHTSA concluded its own probe, which purported to be comprehensive, and Ray LaHood, secretary of the U.S. Department of Transportation (the parent agency of NHTSA), pronounced himself satisfied that Toyota’s cars were safe.

Not only had the public uproar subsided, sales rebounded. Following a slump that was probably attributable as much to the economic downturn as the bad publicity, last year the company regained its status as the world leader in car sales. For Toyota, the long ordeal seemed over.

But some leading automotive experts aren’t buying it. Last December, Toyota agreed to pay $1.3 billion to settle the MDL brought by car owners who claim that they suffered economic damages as a result of these events. Critics point out that it’s a pretty big number for plaintiffs who weren’t even directly affected. Beyond that, more than 200 personal injury cases remain to be resolved in the other MDL. The first bellwether trial had been scheduled for March, but it settled in January on confidential terms. At this writing, it’s unclear how the matter will play out; some lawyers expect another large settlement.

But putting aside the politics and litigation, these automotive experts simply don’t believe that the controversy has been put to rest. They acknowledge that some accidents are caused by drivers stomping on the gas instead of the brake, and some from defective floor mats and gas pedals. But the experts don’t believe that these explain the surge in complaints. Instead, they believe precisely what Toyota has for many years steadfastly denied: that the problem is rooted in electronics.

These experts have found some surprising support from insiders at the National Aeronautics and Space Administration who were close to the investigation NASA conducted into Toyota’s acceleration problems a couple of years ago (and which LaHood cited when he discounted problems with its electronics). And now the experts say they’ve found additional corroboration in the communications of Toyota’s own people. Corporate Counsel obtained scores of internal documents written by employees who were struggling to understand why cars were suddenly accelerating, and where the company could have gone wrong. Among the writers were executives, managers, lawyers, public relations specialists, and engineers.

What this demonstrates, in the age of YouTube and Wikileaks, is how hard it is for multinationals and their in-house counsel to keep a lid on their companies’ internal data.

Many of the documents are marked “secret” and “confidential.” They were provided by Betsy Benjaminson, a translator who has worked for several agencies that translate Toyota documents from the Japanese (and who translated several of those quoted in this article). She says that these shops work for law firms hired to assist the company in litigation.

Benjaminson provided these and many more documents last year to Senator Charles Grassley (R-Iowa), the ranking member of the Judiciary Committee, who then wrote a letter to NHTSA expressing his concern that questions about electronics have not been resolved. Corporate Counsel showed Toyota the complete documents from which quotes were excerpted for this article; read the company’s response here.

Benjaminson is revealing her identity for the first time here. She decided to go public because lives are at stake, she says. “Up to now,” she adds, “the corporate PR megaphone has completely drowned out the victims.”

Four experts agreed to review the documents independently and share their impressions. Keith Armstrong, Antony Anderson, and Brian Kirk are based in the United Kingdom; Neil Hannemann lives in California. All of them have decades of experience. The documents they reviewed date from as early as 2000; the most recent were written a few months after the congressional hearings in February and March 2010. They include many emails along with spreadsheets, flow charts, and diagrams.

On one important point the experts agree: There is no smoking gun that shows that Toyota identified and concealed an electronic defect that was responsible for crashes. But numerous documents, they say, undermine the corporation’s repeated attempts to reassure the public, as exemplified by the testimony of Jim Lentz, the CEO of Toyota Motor Sales U.S.A. Inc. In February 2010 Lentz told a House subcommittee: “We are confident that no problems exist in our electronic throttle systems in our vehicles.” He went on to testify, “We have done extensive testing on this system, and we have never found a malfunction that caused unintended acceleration.”

The documents seem to tell a different story. An email written by Hiroshi Hagiwara, a Toyota vice president in Washington, D.C., and sent to executives in Japan a month before the hearings hints at the turmoil beneath the surface. Hagiwara and Chris Tinto, a V.P. for technical and regulatory affairs and safety, had been talking about the U.S. investigation and an earlier one in Europe that also involved unintended acceleration (UA).

“Tinto is extremely pessimistic,” Hagiwara wrote, “and is saying (public hearings, someone will go to jail, I can’t completely take care of the pedal problem, etc.).” Tinto’s primary concerns (according to Hagiwara): “For NHTSA, we said that our investigations in Europe found that the pedal return is a little slow at a slightly open position, and that there were no accidents, but this is not true. Last year’s situation in Europe (many reports of sticking pedals and accidents, and a TI TS9-161 was filed on October 1, 2009) was not reported to NHTSA.” That failure, Tinto said, “may be a violation of the TREAD Act”—the federal law that requires car manufacturers that conduct recalls in foreign countries to report these to U.S. regulators.

Still speaking of Tinto, who worked for NHTSA in the 1990s before he was hired away by Toyota, Hagiwara continued: “He appears to question how Toyota has grasped and handled the overall UA problem (mat, accelerator pedal, ECU [electronic control unit], and electronic throttle systems, etc.).”

Hagiwara reminded the executives to be careful what they put in writing. He asked them to fax any investigative reports related to Europe. “It is OK to write various things to me in emails written in Japanese,” he advised, “but as much as possible only send materials that would not be controversial if disclosed (namely, things that have been reviewed), and it is best, I think, to discuss things orally.”

Article Source: http://www.law.com/corporatecounsel/PubArticleCC.jsp?id=1202591531416

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