NY judge approves Toyota-US deal, $1.2B penalty

Published on NewsOK Modified: March 20, 2014 at 1:54 pm •  Published: March 20, 2014
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NEW YORK (AP) — Toyota's misleading statements presented a "reprehensible picture of corporate misconduct" as it failed to properly protect consumers from unexpected acceleration in its vehicles, a judge said as he nevertheless accepted a deal that lets the Japanese automaker escape prosecution with a $1.2 billion penalty.

U.S. District Judge William H. Pauley III said the case showed that corporate fraud can kill. He also urged federal prosecutors to continue pursuing individuals who were behind the company's actions after an acceleration problem stemming from ill-fitting floor mats attracted widespread publicity in 2009 when a family of four died in a San Diego crash.

The Justice Department announced the deferred prosecution agreement on Wednesday, saying the company assured the public and regulators that it had adequately addressed the problem through a limited safety recall of certain models when it knew at the time that other models susceptible to the same safety flaw had not been recalled.

Attorney General Eric Holder told a news conference in Washington on Wednesday that Toyota handled the issue "as if it were a simple public relations problem."

At a hearing Thursday in New York, where a felony count of wire fraud was lodged against the company, Pauley agreed to suspend the case until March 20, 2017, at the request of prosecutors. Prosecutors would dismiss the charge if the company satisfies the agreement's terms, which include paying the penalty and appointing a monitor to review policies, practices and procedures.

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