Class action could cost Toyota billions

NEW YORK - A group of nearly two dozen law firms around the US will try to bring a class action lawsuit against Toyota, alleging its vehicles have cost customers billions of dollars in lost value in the wake of massive recalls.

Tim Howard, a Northeastern University law professor leading the group, said that the 8 million-plus vehicles recalled by Toyota have collectively cost their owners more than $2 billion in lost resale value.

Kelley Blue Book and other automotive guides have warned that Toyota's recalls are eroding the value of its vehicles.

On Wednesday, the car appraisal guide estimated that the resale value of recalled cars and trucks will fall an additional 1.5 per cent - that's on top if a 1 per cent to 3 per cent decline that Blue Book analysts forecast last week.

Dozens of so-called economic loss cases have been filed around the country on behalf of Toyota owners who believe the recalls have hurt the value of their vehicles, Howard said.

The group has a hearing scheduled in US District Court in San Diego on March 25, where a panel of judges will decide whether to consolidate the suits into a single national class-action suit.

Toyota has recalled nearly 8.5 million vehicles since November around the globe for problems that include floor mats that can get tangled with the gas pedal and gas pedals that can stick, causing sudden acceleration.

The recalls have prompted a flurry of lawsuits on behalf of drivers who say they were injured in Toyota accidents, as well as by drivers alleging the problem makes their vehicles worth less.

The recalls have drawn interest from Congress, where lawmakers are looking into how the company handled the recalls and whether the government properly investigated numerous complaints.

- AP