Toyota's Legal Nightmare

Toyota's troubles have just begun. All the recalls for acceleration and braking problems have caused a massive number of lawsuits, and not just suits related to death and injuries attributed to safety problems—at least 30 lawsuits seeking class-action status have been filed to pay consumers for the vehicles' reduced value and lost use during repairs. For instance, a team of 22 law firms in 16 states are working on a class-action suit aimed at recovering lost car value. According to the head of the legal team, it should be easy to prove damages, as the value of Toyotas have fallen 2.5 percent to 4.5 percent from four weeks ago. If a typical vehicle was worth $10,000 before the recalls and lost 3.5 percent in value, that's a $350 loss per car. With six million Toyotas recalled, the damages could reach $2.1 billion. If plaintiffs are able to prove that Toyota knew about the defects but did nothing, Toyota could be on the hook for double that. And that's just one of the many suits facing the company.