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NINETY EIGHT REGENCY

Toyota could face criminal charges related to safety recalls

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Toyota could face criminal charges related to safety recalls

By Jayne O'Donnell, USA TODAY

Congressional probes, mushrooming lawsuits and a federal probe into reporting of acceleration defects have raised the risk of criminal charges for Toyota.

The legal stakes are high for Toyota, because it is the first automaker embroiled in major safety issues since tough new criminal penalties became law after 2000's rollover recalls involving Ford Explorers and Firestone tires. The Transportation Recall Enhancement, Accountability and Documentation (TREAD) Act for the first time made individuals who intentionally mislead federal regulators about safety defects subject to possible criminal fines and/or prison.

Toyota revealed last month that a federal grand jury in the Southern District of New York subpoenaed documents relating to sudden acceleration in various vehicles and braking issues in the Prius.

The National Highway Traffic Safety Administration is investigating the timeliness of Toyota's reporting of its sudden-acceleration complaints and fixes and Transportation Secretary Ray LaHood says Toyota could face civil penalties. But the grand jury subpoenas signal that the U.S. attorney for that district has a criminal investigation underway.

"It is safe to assume they had good reason to issue those subpoenas," says former federal prosecutor Robert Mintz of McCarter & English. "They are well aware of the legal standards they have to meet to prosecute the case."

NHTSA has often worked closely with the Justice Department on high-profile safety investigations. Toyota has said it reported "in a timely manner" and is complying with the subpoenas. The Justice Department would not comment.

Bill Boehly, a former NHTSA enforcement chief, says NHTSA will be assessing whether Toyota should have told the agency sooner than it did about pedals that could stick, causing unintended acceleration, and whether it "provided all the information that was requested in the course of its defect investigations."

A trail of documents is being sought from Toyota by investigators in the various probes to discover what safety issues the company was aware of, when they found out about them and what they did in response.

However, Toyota likely has fewer documents to produce than an automaker might have in the 1990s. The TREAD Act sent such a chill through automakers that car company lawyers and managers began warning their engineers to avoid putting test results or conclusions in writing, according to two people who worked with the major automakers on compliance. They requested anonymity because of the sensitivity of the issue.

"The reason they don't put much in writing any more than they can help is they don't want to disclose the thought process or the design process of their staff," Savannah, Ga., plaintiff attorney James Carter says of automakers. "They've had to face that music too many times."

link:

http://www.usatoday.com/money/autos/2010-03-11-toyotacriminal11_ST_N.htm

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