Toyota Entering Settlement Negotiations Following $3 Million Jury Verdict

         In 2009, Toyota began recalling millions of vehicles following numerous reports of sudden, unintended acceleration problems.  Not surprisingly, hundreds of lawsuits were filed against Toyota by drivers of the recalled vehicles.  Toyota agreed to a $1 billion dollar settlement to resolve lawsuits seeking economic losses attributable to the recall, but has declined to enter any settlement agreements with plaintiffs who have filed suits claiming damages for injury or wrongful death.  That is changing following a $3 million jury verdict in Oklahoma.

            Prior to the Oklahoma case, Toyota won all of the unintended acceleration cases that proceeded to trial.  In those cases, Toyota consistently maintained that its vehicles’ designs were not flawed, and, instead, blamed the unintended accelerations on the drivers, stuck accelerators, or floor mats that trapped the gas pedal.

            Toyota’s wave of victories in these suits ended when an injured driver and the family of a deceased passenger filed an unintended acceleration suit against Toyota when the driver’s 2005 Camry accelerated through an intersection and crashed into an embankment.  The plaintiffs claimed that the Camry’s software connected to the electronic throttle-control system was the cause of the unintended acceleration.  Toyota’s lawyers defended arguing that the driver pumped the gas pedal instead of the brakes.  The Oklahoma jury was not persuaded by Toyota and awarded a combined $3 million in damages to the plaintiffs.

            Those who have been following the Toyota litigation find this verdict to be significant for several reasons.  For one, no other plaintiffs had ever claimed that the acceleration was due to Toyota’s electronics.  This novel theory is noteworthy because Toyota had never recalled any of its vehicles for problems related to its onboard electronics.  This new theory of liability also has garnered the attention experts in electronic source coding and others within the industry.  The verdict is also significant due to the size of the verdict rendered in such a conservative jurisdiction.

            Since the verdict, Toyota has indicated its willingness to enter into an intensive settlement process.  Some maintain that the Oklahoma verdict was the likely impetus in getting Toyota to the negotiating table.

Court of Appeals Ruling Revives Lead-Paint Lawsuit

         In Hector Butler Jr. v. S&S Partnership et al., CA No 1., the Court of Appeals addressed whether the lower court erred when it excluded lead tests conducted at Hector Butler Jr.’s former home without first providing his former landlord with notice.  As a result of the lower court excluding these lead tests that purportedly showed high lead levels, summary judgment was granted in favor of the former landlords as to negligence and a separate claim under Maryland’s Consumer Protection Act.

In its opinion, the Court of Appeals stated that the scheduling order for lead tests in Baltimore requires notice be given to “defendants who still own the property.”  Thus, the Court concluded “that the scheduling order, as written in the present case, applied to tests of properties still owned by a named defendant, and that only the defendant with ownership of the property has a right to attend the testing.”  Thus, a landlord who no longer owns the property is not entitled to advanced notice of lead paint testing.  In light of the Court of Appeals ruling, Butler’s lead-poisoning claim against his former landlords is restored since his former landlords no longer own the properties tested, and, as such, had no right to notification pursuant to the scheduling order. 

The Court of Appeals, however, held that granting summary judgment to Butler’s former landlords with respect to his claim under the Consumer Protection Act was not in error.  To succeed in a claim under Maryland’s Consumer Protection Act requires establishing that the landlord actively concealed or failed to disclose the presence of peeling or flaking paint at the inception of the lease.  At trial, Butler’s own mother testified that there was no evidence of chipping or peeling paint when she entered into the lease, and, further, at that time Butler was an infant.  As such, Butler did not establish a reasonable basis under which a determination could be made that the chipping or peeling was present at the inception of the lease, thus, the Court of Appeals affirmed the lower courts grant of summary judgment regarding Butler’s claim under Maryland’s Consumer Protection Act.  

Mediation to Resolve Disputes May Save Time and Money

Although mediation as an alternative to the traditional litigation process is not new to Maryland, a growing number of people are opting to resolve their legal disputes through mediation.  Mediation as a process that seeks to allow individuals to arrive at an outcome that is favorable to all parties rather than have judge or jury determine the outcome of their conflict.  The role of the mediator in this process is to help the parties identify issues relating to the conflict and determine their wants and needs regarding that conflict.  The mediation process may take a day or longer depending on how many issues are in dispute and how different the parties’ perspective on the conflict is.

Maryland courts have established rules that apply to mediation and other alternative dispute resolution options.  Although there are some limited exceptions, pursuant to these rules circuit courts are permitted to refer cases to mediation in an effort to resolve the conflict outside of litigation.  In light of this, an increasing number of civil cases ranging from contract disputes to the division of assets upon divorce are being resolved through mediation.  RSRM attorneys have had great success in cases referred to mediation by the Courts. 

Parties that participate in mediation and are accompanied by counsel must pay their attorneys’ hourly rates.  In addition to costs associated with attorneys’ fees, unless the mediator is court appointed, the mediator must also be paid.  Further, there may be additional costs associated with the mediation, if, for example, the parties choose to bring accountants.  Despite these costs, however, mediation may be less expensive than litigation.  However, if mediation is unsuccessful, then litigation may not be avoided, and mediation will be an added cost. 

The successful use of mediation as an alternative to litigation is highlighted in a 2002 study for the Maryland Judiciary’s Mediation and Conflict Resolution Office.   That study examined 400 cases filed over a fourteen month period in the Baltimore City Circuit Court.  Half of those cases were referred to mediation, and of those cases referred to mediation, twenty-five percent reached a conclusion within four months whereas only twelve percent of cases not referred to mediation reached a conclusion in that same period.  In addition, the study found that approximately eighty-three percent of the cases sent to mediation were resolved prior to the date when that case was scheduled for trial whereas only seventy percent of cases not referred to mediation were resolved prior to the scheduled trial date.

Although mediation may be less expensive than litigation and provide more certainty to parties since their fate is not decided by a judge or a jury, some still desire to have their day in court.