Insurance Blog

Everywhere you look there’s a story about Toyota and the gathering momentum behind a growing number of lawsuits filed against the company following its now three separate but related recalls of about nine million cars worldwide. An article in the L.A. Times today quotes a number of lawyers and legal experts discussing the legal implications for Toyota. For example, Richard Cupp, a professor at Pepperdine University School of Law is quoted as saying: “This has the potential to be the biggest product liability case in the automotive industry.” Others, like David Owen, a law professor at the University of South Carolina also quoted in the article, suggest that while litigation could tie up Toyota for a number of years the ensuing economic damages will be painful but manageable and the company will survive. Another article in the National Law Journal describes the growing number of lawsuits being filed. The cases […]

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As auto manufacturer Toyota begins a publicity offensive in response to two separate but related recalls of around nine million autos worldwide, a couple of reports make the important point that the long-term damage to the company’s reputation could be much more costly than the immediate financial fallout. The recalls and sales stoppages announced by Toyota come after floor mat or accelerator pedal problems in a number of its vehicles and several crashes. An article in the Wall Street Journal observes that if Toyota’s problems escalate, it could cause irreparable damage to its brand identity, requiring the company to spend billions of dollars in advertising, sales incentives, legal bills and, possibly, interest payments. Meanwhile, an article in Business Insurance cites various analysts saying that the damage to Toyota’s reputation for quality and safety could be extremely costly. What action a business should take to limit this damage and the topic […]

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