Lawyers Jostle To Lead Charge Against Toyota

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Cars for sale at a Toyota dealership in Torrance, Calif. i i

Cars for sale at a Toyota dealership in Torrance, Calif. The automaker faces 89 class-action lawsuits related to its safety recall of millions of cars. Robyn Beck/AFP/Getty Images hide caption

itoggle caption Robyn Beck/AFP/Getty Images
Cars for sale at a Toyota dealership in Torrance, Calif.

Cars for sale at a Toyota dealership in Torrance, Calif. The automaker faces 89 class-action lawsuits related to its safety recall of millions of cars.

Robyn Beck/AFP/Getty Images

Toyota is facing an avalanche of lawsuits related to its safety recall of millions of cars, and outside the public eye, powerful plaintiff's attorneys are competing to get in on a contest that could extract billions of dollars from the Japanese auto giant.

Northeastern University law professor Tim Howard says the stakes are huge.

The 89 class-action lawsuits filed against Toyota "ranks as the largest automobile class action in the history of American law and the world," he says.

There are so many lawsuits, in fact, that a panel of federal judges in San Diego is meeting Thursday to sort out the timing, location and logistics of the legal battle.

The suits each claim to be filed on behalf of at least 6 million drivers. Some say Toyota knew about the sudden acceleration problems but failed to tell consumers. Others say Toyota's solution ignores the real problem — flawed electronics. Whatever the reason, owners all claim the value of their cars has plummeted since last fall's recall, and they want full refunds.

Separately, there have been wrongful death and injury suits filed against Toyota and suits filed by shareholders who claim losses from tumbling stock prices.

"There's a lot of money involved," says Arnold Rosenberg, a professor at Thomas Jefferson Law School in San Diego. "Legal fees and referrals are the big payoff for the lead counsel."

Intense Scramble

Experts say Toyota could end up paying out as much as $3 billion for the lost-value claims. Lawyers typically rake in about 30 percent of that settlement.

And that means that behind the scenes, attorneys with vast class-action experience are vying to be picked as one of the leaders in the charge against Toyota.

They're forming alliances with colleagues from past cases; factions are sprouting, and everyone is scrambling to stay ahead of their competitors. Howard says the pace is intense.

"We have dinners. We have all-day symposiums. We share ideas. We share e-mails. We have internal training sessions from highway safety experts," he says.

One of the top lawyers behind the lawsuits against Toyota is New Orleans attorney Richard Arsenault. He's filed cases in Missouri, Louisiana and California, and is investigating several dozen more claims.

"I'm not preoccupied with being lead counsel," he says. "I'd like to play a meaningful role in the litigation. It's an opportunity for creative lawyering; it's an opportunity for creative thinking."

Arsenault put some of that creative thinking to work leading a conference for about 100 lawyers Wednesday in San Diego. There were mini-tutorials on topics like how to decipher the litigation, and on Toyota's event data recorders, which contain information on crashes.

New York lawyer Hunter Shkolnik says attending conferences like these is key if you want to get in this game and understand the issues.

"Someone who's sitting on the sidelines doing nothing, [who] pops up on the last day, generally is not the person who is going to be thought of as a leader in the case," he says.

'A Beauty Contest'

Still, it's up to the judge.

"All of the meetings and get-togethers and jockeying really means nothing," Shkolnik says. "It's the judge and who the judge wants to have run the case. Ultimately, it becomes a beauty contest; beauty in the sense of who brings the most to the table that will do the best job for the litigation."

The panel of judges meeting Thursday is expected to announce a decision in two weeks on whether similar lawsuits filed in different districts should be centralized at one location, and on whether the many claims against the carmaker can be consolidated as one huge class action.

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