Michigan Attorney General Bill Schuette announced a multistate settlement with TK Holdings, Inc., the U.S. subsidiary of Takata, over allegations that the company had concealed safety issues with their airbag systems, installed in a wide variety of vehicles impacting drivers and passengers across the country. The company filed for chapter 11 bankruptcy in June of 2017, and its reorganization plan has been confirmed by the United States Bankruptcy Court for the District of Delaware. The settlement reached between the attorneys general of 44 states and the District of Columbia, along with TK Holdings, Inc., concludes the multistate investigation into the company’s failure to timely disclose known safety defects with its airbag inflators using phase-stabilized ammonium nitrate as a propellant. TK Holdings Inc. has also agreed to reimburse the multistate for its investigative costs, and for entry of stipulated civil penalty in the amount of 650 million dollars. The multistate agreed that given the pending bankruptcy and the company’s inability to pay its debts, this penalty would be subordinated in order to maximize the recovery available to consumers who were the victims of the airbag defect. The multistate alleged that the company knew of the airbag inflator’s safety defect due to testing failures. TK Holdings, Inc.’s parent company pled guilty to manipulating data and submitting false and misleading reports to auto manufacturers. The company was aware of airbag ruptures as early as 2004 but did not take appropriate action to recall unsafe airbag inflators or notify regulators and the public of the danger until November of 2014.
February 23rd, 2018|Local News|