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Toyota (NYSE: TM ) has agreed to pay $1.1 billion in reimbursements, compensation, and other costs to settle a class action lawsuit, the company said in a press release. The case, which is being heard in a federal court in California, stems from a series of vehicle recalls in 2009 and 2010 due to the possibility of unintended acceleration.
As part of the settlement, Toyota will pay cash compensation to eligible car owners, sponsor driver education programs, and contribute to new advanced safety technology research initiatives.
The settlement will cover the owners of up to 16 million cars. Toyota said it will book the entire amount as a one-time charge.
The press release quoted Toyota Motor Sales' U.S.A. group vice president, Christopher Reynolds, as saying that "this was a difficult decision -- especially since reliable scientific evidence and multiple independent evaluations have confirmed the safety of Toyota's electronic throttle control systems. However, we concluded that turning the page on this legacy legal issue through the positive steps we are taking is in the best interests of the company, our employees, our dealers and, most of all, our customers."