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US consumers have filed a lawsuit against Kobe Steel Ltd
and Toyota Motor Corp accusing the companies of violating consumer protection laws and engaging in fraud by concealing the use of substandard metal components in vehicles.
The proposed class-action lawsuit represents the first US consumer complaint filed against Kobe Steel over an issue that has been dogging Japan’s third-largest steelmaker for nearly five decades.
Kobe, which supplies steel parts to manufacturers of cars, planes and trains around the world, admitted last year to supplying products with falsified specifications to about 500 customers, throwing global supply chains into turmoil.
Earlier on Tuesday, Kobe said its CEO will step down to take responsibility for the widespread data fraud scandal.
The US lawsuit, filed on Monday in federal court in San Francisco, was brought by two California residents who seek to represent a nationwide class of consumers who bought allegedly defective Toyota vehicles.
According to the complaint, Toyota’s Prius, Camry, Land Cruiser and Lexus vehicles have all been manufactured with “sub-standard” steel, aluminum and copper.
The plaintiffs allege that Toyota and Kobe Steel both violated federal and state consumer protection laws by claiming that the vehicles complied with US quality standards.
Kobe Steel could not immediately be reached for comment. Toyota declined to comment on the lawsuit.
In a special order in November, the US National Highway Traffic Safety Administration asked 29 automakers, including Toyota, to disclose the safety of any of their vehicles or engines containing products supplied by Kobe Steel.
Monday’s 40-page lawsuit outlines the ways in which the companies allegedly concealed poor metal quality. It demands compensatory and punitive damages in an unspecified amount.
Toyota had the duty to disclose any defective vehicle components because it has consistently marketed its automobiles as safe, functional and reliable, the lawsuit says.
Kobe and Toyota had superior knowledge and access to the facts, the lawsuit alleged, giving rise to fraud by concealment claims.
(REUTERS)
