Takata Airbag Lawsuits and Settlements

As of January 2019, roughly 41.6 million vehicles had been recalled to replace 56 million Takata airbags that could explode. Exploding airbag inflators have hurled metal shrapnel at drivers and passengers, causing serious injuries and multiple deaths.

The sheer cost of the recall forced Takata into bankruptcy. But there are trust funds set up to continue paying claims filed by people who suffered personal injury or wrongful death caused by the defective airbags.

Several automakers have also established settlement funds totaling more than $1.5 billion for people who suffered economic losses because of the recall. Three dozen carmakers installed the defective airbags in more than 180 different models of cars and trucks between the 2000 and 2018 model years.

People injured or relatives of people killed in a Takata airbag explosion should keep the inflator parts until after an inspection of the vehicle and investigation into the accident have been completed.

People who were not physically injured may be able to recover costs for economic losses they experienced because their vehicle was recalled. These are part of settlements from automakers.

Separate actions by the U.S. Department of Justice and attorneys general from 44 states and the District of Columbia resulted in $1.65 billion in penalties against Takata. Much of the money was earmarked to compensate people whom the company’s airbags had injured.

The Justice Department charged Takata with wire fraud. Investigators claimed that Takada knew as early as 2000 that their airbag inflators were defective, but the company concealed the dangers from United States regulators.

“For more than a decade, Takata repeatedly and systematically falsified critical test data related to the safety of its products, putting profits and production schedules ahead of safety,” Andrew Weissmann, former chief of the Fraud Section of the Justice Department’s Criminal Division, said in a January 2017 statement.

In January 2017, the Justice Department announced Takata would pay a $1 billion criminal penalty that included $975 million for restitution and a $25 billion fine.

The restitution was split into an $850 million fund for automakers that have incurred recall and repair costs, and a $125 million fund for consumers who have been physically hurt by Takata’s airbags and who have not already reached a settlement with the company.

In a separate case, the state attorneys general accused Takata of concealing safety problems with its airbags and failing to report safety defects. They claimed the company engaged in unfair and deceptive practices that violated state consumer protection laws.

In February 2018, Takata agreed to pay $650 million to settle the complaints. But the states announced they would not collect the settlements, opting instead to leave the money for people injured by the company’s airbags.

By the time of the settlement with the states, Takata had declared bankruptcy and sold its remaining assets to rival Key Safety Systems.

When Takata filed for bankruptcy, it set up the Takata Airbag Tort Compensation Trust Fund, or TATCTF, to pay settlements to people who were injured or lost a loved one to the company’s airbags.

In addition, the United States District Court for the Eastern District of Michigan established the Individual Restitution Fund, or IRF, as part of Takata’s criminal plea.

Injured people may submit a claim for compensation from both funds and may bring up to three types of claims at the same time. The requirements for qualifying differ from one type of claim to another and may be confusing.

Though you do not need an attorney to file a claim, the funds’ trustee recommends consulting a lawyer because the legal issues can be complex.

The funds all share the same two deadlines for submitting a claim. If the incident happened before April 10, 2018, your claim must be postmarked or submitted online no later than April 10, 2021. Claims for airbag incidents occurring on or after April 10, 2018, have to be submitted within three years or within the legal deadlines set by the state where the incident happened.

The IRF fund was set up following Takata’s guilty plea for fraud in 2017. It includes $125 million for people who have suffered physical injuries from the company’s airbags. It will also cover injuries that may occur in the future.

The TATCTF fund compensates people who have been injured or suffered wrongful death because of a malfunctioning Takata airbag. It was set up as part of Takata’s bankruptcy plan, which was confirmed by the United States Bankruptcy Court for the District of Delaware in February 2018.

The company agreed to create a trust fund of between $90 million and $137 million.

Certain people may also submit a claim to the TATCTF against the automobile manufacturer, referred to as the participating original equipment manufacturer, or POEM. Only people who suffered personal injury or wrongful death from a defective Takata airbag in a Honda or Acura vehicle are eligible for a POEM claim. Such vehicles have been involved in 14 of the 16 Takata airbag-related deaths in the United States.

The Takata Airbag Products Liability Litigation Settlement includes separate settlements with seven large automakers for economic losses people experienced while having their airbags replaced.

Repairs were done for free as part of the recall. But people may have had out-of-pocket expenses because they were without their cars for a period of time or because they brought their cars to a dealership for repairs.

Automakers that have agreed to settle are BMW, Ford, Honda, Mazda, Nissan, Subaru and Toyota.

The settlements were part of a mass litigation involving 327 lawsuits filed in courts around the country. They were combined into a South Florida federal court in 2015.

Other automakers named in the litigation include General Motors, Chrysler, Volkswagen and Mercedes-Benz. As of May 2019, none of these companies had announced a settlement, and 199 lawsuits remained pending in the litigation.