Was Toyota Bragging When It Saved $100M In Recall?


Was Toyota simply conducting business or acting against the interests of consumers when it saved millions by limiting the scope of a safety recall in 2007? That question will be raised to company officials when they appear before Congress this week.

Gallery: Toyota Recall Document

Details of the company’s actions were obtained by The Detroit News, which received a cache of documents given to the House Oversight and Government Reform Committee by Toyota. One document in particular shows the company internally highlighted its $100 million savings by way of conducting a limited recall as opposed to a full one.

That particular limited recall, involving sudden acceleration on Toyota and Lexus vehicles, was limited to 55,000 vehicles in 2007, which company officials considered a “win.”

In August of 2009, a family of four died in a crash related to unintended acceleration issues, causing many to wonder if Toyota should have expanded the scope of those earlier recalls. After the August accident, the number of actions by the company has increased, although not without some government prodding. To date, Toyota has recalled 5.4 million vehicles in the U.S. for unintended acceleration problems due to pedal entrapment, while 2.3 million were recalled for sticky accelerator pedals.

NHTSA claims that more than 2,000 complaints have been filed. Some 34 deaths have been attributed to the various Toyota recalls as well.

The Whistleblower 

In addition to documents turned over by Toyota, the House committee subpoenaed former Toyota lawyer Dimitrios Biller to turn over 6,000 documents for Wednesday’s hearing.

Biller says documents show the company destroyed legal evidence regarding SUV rollover accidents. The documents were amassed between 2003 and 2007 when Biller worked at Toyota’s North America headquarters in Torrance, CA where he managed rollover cases.

Biller’s attorney, Jeffrey Allen of Santa Monica, CA, said that he intends to comply with the recent subpoena and send the reported 6,000 documents to the House Oversight Committee before the hearing in Washington with Toyota president Akio Toyoda, set to begin on Wednesday.

Toyota has not said whether the company intends to try to block the subpoena in court. The company has been quiet regarding Biller’s statements, but indicated through a prepared statement that the company would be frank with the U.S. Government and people this week.

“I have received Congressman Towns’ invitation to testify before the House Committee on Oversight and Government Reform on February 24 and I accept,” said Toyoda in a written statement. “I look forward to speaking directly with Congress and the American people.”

What is known is that these subpoenaed documents have already dug a rift between the former employee and the company: Toyota sued Biller in 2008.

According to Allen, while Biller was at the company he tried to bring his concerns regarding Toyota SUV rollovers to the attention of senior headquarters executives in Japan. He claimed that Toyota SUVs were being built with roofs that would not protect drivers in the case of a rollover accident. He was spurned by executives and ultimately driven to his resignation. 

A lawsuit followed in 2008 after Biller’s departure when he allegedly exposed confidential Toyota information, a violation of his severance agreement. The company is seeking $33.5 million in damages.

Biller countered by filing a racketeering suit alleging that Toyota destroyed documents regarding over 300 rollover suits. 

“There is clear evidence that Toyota was withholding and destroying documents necessary in litigation and necessary to present to [the NHTSA],” Allen said.

The House subpoena overrides a ruling during the lawsuit that prevented Biller from going public with the confidential documents. They are still in his possession because he was never required to return them or provide an inventory of the ones he has.

More drama to come

Allen had harsh words for Toyota, stating in a recent interview with ABC News, “You have to understand that Toyota in Japan does not have any respect for our legal system they did not have any respect for our laws.”

Biller’s SUV rollover documents do not seem to directly relate to the ongoing issues with unintended acceleration in Toyota vehicles, but the evidence could strike a devastating blow to the company, especially if the House committee finds that it has been destroying or ignoring evidence related to serious safety issues.

Though the documents will remain shrouded in mystery until the hearing on the 24th, it seems clear that the House committee is concerned with issues beyond the recent recall.

Mr. Toyoda will certainly have his work cut out for him on Wednesday.

Stashi is an Editor at Driver Pulse, a provider of online automotive editorial reviews and latest news throughout the automotive industry. From the sight of sleek curves to the sound of a roaring engine, old and new, she has a great love for vehicles of all makes and models. What she finds most exciting is that automakers of iconic muscle cars from the past, such as Ford and Chevrolet, are reproducing them for this generation of gearheads. Her dream car, the 1964 or 1966 Ford Mustang, is the ultimate American pony car and paved the way for her love of growling and rumbling engines of old school muscle cars. She spent her whole life in the Midwest and still finds herself playing the same game she once played with her father when she was a young girl. It’s a game her father liked to call “Name that make and model”. This game has become more challenging as the years pass making it a great way to pass the time on long road trips. She believes that automobiles, old and new, are an art form that can be enjoyed by both children and adults.

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