Takata Airbag Settlements to Promote Safety Recalls, Compensate Consumers of Toyota, Subaru, Mazda, BMW

$553 million settlements to accelerate removal of dangerous airbag inflators from 15.8 million affected vehicles

Plaintiffs in the Takata Airbag Product Liability Litigation today filed class action settlement agreements resolving claims against Toyota, Subaru, Mazda and BMW that will accelerate the removal of dangerous airbag inflators from 15.8 million affected vehicles while also compensating consumers for their economic losses. The agreement was filed in the U.S. District Court for the Southern District of Florida, Miami Division as part of the multidistrict litigation currently being overseen by Judge Federico A. Moreno.

The proposed settlements totaling $553 million will provide numerous benefits to current and former owners and lessees of the affected vehicles. A portion of the settlement fund is devoted to address the low number of vehicles that have received the recall remedy since the National Highway Traffic Safety Administration (NHTSA) first announced recalls of defective Takata airbags. As of April 28, 2017, according to NHTSA, recalls completion rates of total affected airbags were Toyota – 31.89 percent; Subaru – 31.37 percent; Mazda – 18.16 percent; BMW – 16.48 percent.

Among the benefits provided for in the Takata Airbag settlements is a new independent outreach program that seeks to dramatically increase recall remedy completion rates. The program will regularly contact class members through direct mail, phone calls, email, internet ads and social media to educate them about the settlement and incentivize them to receive the recall remedy and exercise their rights under this agreement.

The settlements also provide compensation to class members for their economic losses resulting from the recall in the form of reimbursement for reasonable out-of-pocket expenses; a possible residual distribution payment of up to $500; requirements to provide rental cars to the most at-risk class members while they wait for their recall remedies; and the provision of a customer support program for repairs and adjustments on the replacement inflators, including an extended warranty.

“This agreement achieves our goals of educating consumers about the urgent need to have their recall remedies completed while providing them compensation for their economic losses,” said Peter Prieto, Court-appointed Chair Lead Counsel, who along with other members of the Plaintiffs’ leadership, negotiated the settlement on behalf of consumers. “The low number of recalls to-date demonstrates the need for a settlement of this type, and we look forward to accelerating the removal of defective Takata airbags from the roads. We appreciate the efforts of Toyota, BMW, Mazda and Subaru to do right by their customers in reaching these agreements, and we look forward to the Court’s approval so implementation can begin soon.”

Vehicles subject to this agreement include 9.2 million Toyota vehicles, 2.6 million Subaru vehicles, 2.3 million BMW vehicles and 1.7 million Mazda vehicles (please see chart below for full list of the makes and models of subject vehicles). Personal injury claims related to the Takata Airbag Litigation are not covered by this settlement.  Economic loss claims pending against Ford, Honda and Nissan will continue to be prosecuted.

The settlements are subject to Court approval. If preliminary approval is granted, class members will receive more information about the terms of the settlement. The Rental Car Loaner Program will also begin at this time for class members who own what are known as Priority One vehicles, i.e., the vehicles whose inflators are at most risk of rupturing. When and if the Court grants final approval, the claims process will open to eligible class members pending any appeals that are filed.

Settlement Overview

BMW, Subaru, Mazda and Toyota have reached class action settlements valued at a total of $553 million to resolve economic loss claims related to their use of allegedly defective Takata airbag inflators

○      BMW: $131,000,000

○      Subaru: $68,262,257

○      Mazda: $75,805,050

○      Toyota: $278,500,000

• The lawsuit alleged that these airbag inflators could, upon deployment, rupture and expel debris or shrapnel into the occupant compartment and/or otherwise affect the airbag’s deployment
• This settlement does not involve claims of personal injury or property damage

Benefits

The proposed settlement benefits include, among other components, an Outreach Program, Rental Car Loaner Program, Out-of-Pocket Claims Process, Customer Support Program, and Residual Distribution of remaining funds.

Outreach Program

• The Outreach Program, overseen and administered by the Settlement Special Administrator, shall be designed to significantly increase Recall Remedy completion rates via traditional and non-traditional outreach efforts beyond those currently being used by the settling manufacturer defendants and conducted in connection with NHTSA’s November 3, 2015 Coordinated Remedy Order and amendments
• The Outreach Program for the Takata Airbag Inflator Recalls will include elements such as direct contact of Class Members via U.S. Mail, telephone, social media, e-mail, and texting; contact of Class Members by third parties (e.g., independent repair shops); and multi-media campaigns, such as through print, television, radio, and the internet

Rental Car Loaner Program

• Class members who currently own or lease a Subject Vehicle that is a Priority Group I vehicle, as specified by the National Highway Transportation Safety Administration (NHTSA), will receive a rental/loaner vehicle
• To be eligible, the Class Member must contact a dealership of their vehicle manufacturer and request replacement of the Takata airbag inflator
• If the dealership informs the Class Member that it does not have the Recall Remedy parts in stock, the Class Member must request a rental/loaner vehicle
• If, after thirty days following the Class Member’s request, the dealership is unable to obtain the necessary Recall Remedy parts, a rental/loaner vehicle will be made available to the Class Member, until a Recall Remedy is performed on the Class Member’s Subject Vehicle

Out-of-Pocket Claims Process

• Class members can ask to be reimbursed for certain reasonable out-of-pocket expenses related to the Takata Airbag Inflator Recalls
• To be eligible for reimbursement, you must submit a Claim Form, which will be mailed to Class members and made available on the settlement website
• The Settlement Special Administrator will determine the types of reimbursable costs, which may include unreimbursed rental car and transportation expenses; storage or towing charges for completion of the Recall Remedy; or, childcare expenses or lost wages necessarily incurred during the time in which the Recall Remedy is being performed
• The Settlement Special Administrator can also reimburse other categories of out-of-pocket expenses if they are deemed reasonable

Residual Distribution

• Any funds that remain at the end of each of the first four settlement program years, after all Outreach Program and out-of-pocket expense payments for that year have been made, shall be distributed in an amount up to $250, to Class Members who:

○      submitted claims in that year or prior program years that were previously rejected; or

○      sought to register for a residual payment only

• If administratively feasible, any funds that remain at the end of the last settlement program year after the Residual Distribution shall be distributed on a per capita basis, in an amount up to $250, to Class Members who:

○      submitted claims in this or prior program years that were previously paid;

○      submitted claims in this or prior program years that were previously rejected and have not received any prior claims payments under this settlement program; or,

○      sought to register for a residual payment only

Customer Support Program

• The Customer Support Program will provide prospective coverage for repairs and adjustments (including parts and labor) needed to correct defects, if any, in materials or workmanship of the Takata PSAN inflators contained in the driver’s or passenger’s front airbag modules of Subject Vehicles, or replacement driver or passenger inflators installed pursuant to the Takata Airbag Recall in the Subject Vehicles
• This benefit will be automatically transferred and will remain with the Subject Vehicle regardless of ownership
• The Customer Support Program will generally last for no less than 75,000 miles from the date the Recall Remedy was performed on the Subject Vehicle, and each eligible Subject Vehicle will receive no less than 2 years of coverage from the date of the issuance of the Court’s Preliminary Approval Order or from the date the Recall Remedy was performed on the applicable Subject Vehicle, whichever is later

The settlement will not be final unless and until the Court grants final approval of the settlement at or after the Fairness Hearing and after any appeals are resolved in favor of the settlement.

Subject Vehicles

You are part of the Takata Airbag settlements if you are:

1. a current owner and/or lessee of a Subject Vehicle distributed for sale or lease in the United States or all of its territories and possessions, as of the date of the issuance of the Preliminary Approval Order, or
2. a former owner and/or lessee of a Subject Vehicle distributed for sale or lease in the United States and all of its territories and possessions, who sold or returned, pursuant to a lease, a Subject Vehicle after April 11, 2013 and through the date of the issuance of the Preliminary Approval Order.

The Subject Vehicles are as follows:

Toyota: