Filed under: Government/Legal, Recalls, Safety, Toyota, Earnings/Financials



Last Friday, Toyota's stock closed at $79.56. That represents a 12-percent drop in market capitalization. For those keeping track, that's a loss of $15 billion. Naturally, there are a number of none-too-pleased shareholders hanging on to their stock in the Japanese automaker.

As such, it comes as little surprise that law firm Murray, Frank & Sailer has filed a class-action lawsuit in U.S. District Court in California on behalf of any and all shareholders who purchased stock between Dec. 22, 2009 and Feb. 2, 2010. The suit contends that Toyota issued "materially false and misleading statements" and "failed to disclose ongoing safety issues and quality control problems with Toyota's automobiles," especially issues related to alleged cases of unintended acceleration.

Would shareholders that purchased stock in Toyota have done so if the automaker had taken a more pragmatic stance on the problems it was about to face? It would seem that's up for a judge to decide.

Peter Henning, a Wayne State University law professor cited by The Detroit News, points out that securities cases are notoriously difficult to prove. "You are going to have to prove knowledge among the corporate management. Unless something else emerges, it seems that Toyota didn't think that it would be the kind of problem that it turned out to be," said Henning.

A three-judge panel is set to meet on Thursday to consider this and all other impending class action suits against the beleaguered automaker. Until then, Toyota certainly has its hands full with potential headache-inducing litigation to consider.

[Source: The Detroit News | Image: Junko Kimura/Getty]Toyota being sued by shareholders for lying about its business originally appeared on Autoblog on Mon, 22 Mar 2010 16:28:00 EST. Please see our terms for use of feeds.



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Hi

it comes as little surprise that law firm Murray, Frank & Sailer has filed a class-action lawsuit in U.S. District Court in California on behalf of any and all shareholders who purchased stock between Dec. 22, 2009 and Feb. 2, 2010. Toyota‘s stock closed at $79.56. That represents a 12-percent drop in market capitalization. For those keeping track, that’s a loss of $15 billion.
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ummmm, Steve, I don't how to say this so I'm just going to say it

Your reply was nothing but randomly quoted lines from the OP with "Hi" at the beginning, and your sig bothers me. You've only made 2 posts....this one and one other one, which is in the same format. Question for steve: Do you own a toyota and will you post pics of you eating a bowl of cereal to prove that your not here just to adverise whatever goofy get rich quick scheme your trying to advertise in your sig?