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Allstate sues Toyota in gas pedal cases

October 5, 2010

Allstate sues Toyota in gas pedal cases

Insurer seeks more than $3M for clients involved in collisions caused by defects

The Detroit News

Allstate Insurance Co. has sued Toyota Motor Corp., alleging that some of the insurer’s customers were involved in collisions resulting from faulty gas pedals and other defects in Toyota vehicles.

Allstate said Monday it was seeking more than $3 million in a suit that underscores Toyota’s challenge to move beyond quality and safety problems that emerged last year and led to the recall of millions of vehicles.

Toyota rejected the allegations. “While we have not seen the complaint, based on reports we believe the unfounded allegations in this suit have no basis,” Toyota Motor Sales USA. said in a statement.

Earlier Monday, the automaker briefed reporters on its progress establishing tighter quality controls and fixing about 3.7 million recalled vehicles. Bloomberg News reported the lawsuit later in the day.

“Allstate believes some of our customers were involved in collisions as a result of faulty accelerator pedals and other vehicle defects on Toyota vehicles and that Toyota should be held accountable for the financial impact of these accidents,” said Christina Loznicka, a spokeswoman for the Northbrook, Ill., insurer.

“Allstate, like other insurers, has filed a subrogation lawsuit against Toyota in the state of California,” she said. In subrogation suits, insurers try to recoup claims from manufacturers on the grounds that the products are defective.

The suit cited data from Safety Research & Strategies Inc. of Rehoboth, Mass., a safety advocacy firm that works with plaintiffs’ lawyers.

Safety Research President Sean Kane had not read the suit. But he said such suits by insurers against carmakers were unusual, suggesting a possible breakdown in negotiations.In its complaint in California state court, Allstate alleged that sudden acceleration accounted for at least 725 accidents with 304 injuries and 18 fatalities, citing Safety Research and Strategies data.

Toyota has recalled more than 9 million vehicles worldwide since last fall, most of them in the United States, mostly to address problems that could lead to unintended acceleration.

The company said Monday that its U.S. dealers have provided fixes to around 3.7 million vehicles, which were recalled to repair pedals that could stick, update braking software and prevent a risk of pedal entrapment that could cause cars to accelerate.

The automaker plans to expand the scope of rapid-response “Smart” teams formed to investigate complaints of unintended acceleration of Toyota vehicles to look into other problems as they come up. Since April, complaints of unintended acceleration of Toyota vehicles have dropped sharply to fewer than 150 calls a week to a customer hotline from around 800, Toyota said.

In all its repairs and investigations to date, Toyota executives reiterated that the company found no instances of unintended acceleration resulting from problems with the electronic throttle control system.

“Our goal is to set new, even higher standards for quality assurance and customer responsiveness in both the factory and the market,” said Steve St. Angelo, Toyota’s chief quality officer for North America.

The Smart teams are drawn from more than 200 engineers and field technicians.

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