Monday, February 22, 2010

Toyota and punitive damages

An internal Toyota document dated last July says the company saved $100 million in 2007 by getting the government to OK just replacing floor mats in 55,000 vehicles as a solution to sudden acceleration complaints.

It's listed under "wins for Toyota — safety group" in the report, which is among documents obtained by a subpoena from the House Committee on Oversight and Government Reform.

That and other references to saving money on safety issues raise the question of "whether Toyota was lobbying for less rigid actions from regulators to protect their bottom line," said Kurt Bardella, spokesman for the committee's ranking Republican, Darrell Issa of California.

The survivors of anyone who died as a result of the Toyota design flaws have a very good claim to some of the $100 million Toyota saved " by getting the government to OK just replacing floor mats". These "savings" at the cost of consumer safety would be an inarguably valid measure of computing any punitive damages to be awarded in addition to compensatory damages (i.e., the value of the life of the deceased).

Supporters of tort reform and limitations on awards need to remember the historical reason for punitive damages - - to divest wrongdoers of the profits from their wrong doing. If Toyota let people die in order to save $100 million, the survivors of the dead deserve the $100 million.

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