/ Blog/ Airbag Manufacturer Faces Billion-Dollar Settlement
Takata, whose faulty airbag components led to the worldwide recall of tens of millions of vehicles, has reached a settlement with the US Justice Department. The settlement, announced in January, would see Takata plead guilty to providing falsified data to federal investigators and the company would pay out a total of $1 billion in direct fines and compensation to victims and auto makers. In addition, three Takata executives will face individual charges over faked safety data.
The Takata defect is no run-of-the-mill recall. The problem has been ongoing for more than a decade and is now believed to affect more than 40 million vehicles. The critical issue is not the airbag itself but the inflator that fills it. The inflator is a small propellant charge used to quickly fill the bag. In some cases, it becomes contaminated or deteriorated in a way that causes it to explode with too much force when triggered, breaking parts of the airbag assembly and sending metal shrapnel at the driver or passengers the airbag is meant to protect.
The first recall of these products was issued in 2008, but it now covers some vehicle models back to 2001. By early December of 2016, the USDOT knew of 11 deaths and 184 injuries that could be blamed on these airbags. Recent counts by regulators show that the recall has been completed in only about 13 million vehicles.
Takata will only pay the US government $25 million. But it will also pay another $125 million to compensate injured victims and the heirs of those killed, and it will owe $850 million to auto makers, who have largely paid the costs of the recall and replacement out of their own pockets.
The three executives who were separately charged are accused of manipulating data about the problem back to at least the year 2000. Documentation allegedly shows that for years they routinely discussed covering up the problem. Whether they will ever face a trial or jail time is uncertain, but the Department of Justice said it will seek their extradition from Japan and didn’t rule out future charges against others.
While the Takata recall has been extraordinary in scale and duration, defective consumer products are recalled every day. Many recalls happen to correct unforeseen problems, and most manufacturers react quickly and responsibly. But when a product causes harm because of known problems, affected customers should seek compensation from the manufacturer. Numerous lawsuits are pending against Takata and some auto manufacturers. They claim negligence by continuing to produce and sell products with known defects.
If you or someone close to you has been injured by a defective product, talk to Wilson Kehoe Winingham. We have years of experience with product liability law. We offer a free consultation to all clients to discuss their unique, individual claim. Call 317-920-6400 or contact us online today to schedule yours.
Fill out the form below to receive a free and confidential initial consultation.