Toyota Motor Corp. and attorneys representing people who claim their Toyota vehicles are prone to sudden, unexplained acceleration announced a settlement Wednesday worth more than $1 billion. Some of the key provisions of the agreement, which must be approved by a federal judge:
— A fund of $250 million will be established to pay former Toyota owners who sold their cars during the period from Sept. 1, 2009, through Dec. 31, 2010. The money is intended to compensate those owners for the reduced value of their vehicles that is alleged because of publicity concerning unintended acceleration.
— Toyota will install a brake-override system in an estimated 3.25 million vehicles subject to floor mat entrapment recalls. Brake-override systems cut power to the throttle under certain circumstances when the car receives simultaneous signals from the brake and accelerator pedals.
— A separate fund of $250 million will be established to compensate current owners whose vehicles are not eligible for a brake-override system. The amount consumers receive depends on the model and year of their Toyota, and the state in which the car was purchased.
— All 16 million current owners will be eligible for a customer care plan that will warranty certain parts that plaintiffs allege are tied to unintended acceleration for between three and 10 years.
— $30 million in education grants will be provided to independent academic institutions to further the study of auto safety and to enhance driver education.
Current and former Toyota owners are expected to receive information about the settlement and instructions on filing a claim in the coming months.
Limited details of the settlement are available at http://www.hbsslaw.com/toyota , http://www.ToyotaELsettlement.com , or by calling 1-877-283-0507.