Tuesday, September 30, 2014



The Sleeping Gypsy by Henri Rousseau

I dreamed that I was on the floor and that Akio Toyoda was standing over me speaking harshly to me.

Why does the eye see a thing more clearly in dreams than the imagination when awake?

Monday, September 29, 2014

Toyota Corolla sudden acceleration is belatedly investigated by NHTSA

Karl, dear, I know just how you feel.

Finally, finally, once again NHTSA has been forced by a Toyota owner to open an investigation after a pretty plain-as-day UA event occurred that was similar to many others, and for which there isn't any good explanation other than "the electronics did it." 

Let's see if NHTSA's Scott Yon or Jeff Quandt will find a way to wiggle out of this one, this time. And by the way, guys, there are still ways that you could learn the real truth, that very same truth that I have been trying to tell you for a few years. You have not listened. What will you do tomorrow? 

Dr. Phil Koopman says:

Testing alone is insufficient to ensure safety in critical systems. Other technical approaches and software development process management approaches must also be used to assure sufficient software integrity.

Relying upon just system functional testing to achieve safety can be expected to eventually lead to an unsafe situation in a widely released product. Even if system functional testing is completely representative of situations that will happen in practice, such testing normally won’t be long enough to see all of the infrequent events that will occur with a much larger fleet of vehicles deployed for a much longer period of time.

Today I spent nearly the entire day reviewing Toyota's testing-related documents. 
I can't say much more than OMG.

And if, like Toyota, you do not listen to Dr. Koopman's sage advice, you get THIS!!

Doors to hell and to heaven

 Hell's door - Darvaza burning crater, Turkmenistan

Easy to fall in there. Is there life at the bottom? 
Shakespeare says "Hell is empty and all the devils are here."


Heaven's door. One must have a key. Or knock to be admitted. 

I am now paused while I wait for a decision if it is safe enough to keep blogging. 
Is this blog a door to legal hell or, unlikely, to legal heaven? 
Or is it simply a door to freedom of speech?

Door to freedom. 
This particular door in Ashkelon is millenia old and provides a passage from the city to the sea,
 or the sea to the city. 

Sunday, September 28, 2014

Posse List story: Knives galore at Betsy's back

Oh what a feeling

       Every law firm’s fear: translator decides to keep documents she translated and become whistle blower

Sep 25th, 2014 | By | Category: Top Story

25 September 2014 - A translator who provided internal Toyota documents to news reporters has objected to the carmaker’s requests for sanctions against her for alleged failure to obey a protective order in litigation over sudden acceleration.

....Toyota was hiding the truth about what caused the sudden unintended acceleration, she believed. They were blaming floor mats and many other causes, the “ghost in the machine” as one Toyota PR suit said. But the ghost wasn’t floor mats or driver error, and the company knew it she says.
As a translator, Benjaminson had access to thousands of Toyota’s classified documents spanning from 2002-2010, mostly run-of-the-mill accident reports and records of repairs, but also internal business memos and emails from engineers. As the months went by, a pattern began to emerge from the static of the corporate correspondence and technical manuals, an occasional whisper that turned increasingly into a roar she could not ignore.
As Benjaminson dug deeper, she felt she had no choice but to reveal what she saw, consequences be damned.
Despite the strident denials from Toyota, and the US government reports, Benjaminson felt that the documents in her hands proved that Toyota engineers knew there was a serious problem with their cars causing sudden acceleration, something well beyond oversized floor mats.
Not surprisingly, Benjaminson was fired by her translation agency after they found out she was behind the leaks.
She has lost a lot of income, but in the end she says “maybe it was stupid, but I was honest”.

However … as always … money seems to rule. As the directors at two staffing agencies told us: “we can price remote reviews at a much, much lower cost for the client than an in-house review and that is why they are becoming so popular, especially translation projects”.

Whole story here.

Wednesday, September 24, 2014

Rosh Hashana

Traditional honey.

Today starts Rosh Hashana, our new year. I won't be posting for a few days.
A sweet year to any readers who celebrate this holiday.

National Law Journal article - "Translator Fights Back in Dispute Over Toyota Documents"


Translator Fights Back in Dispute Over Toyota Documents

, The National Law Journal
September 24, 2014
A translator who provided internal Toyota documents to news reporters has objected to the carmaker’s requests for sanctions against her for alleged failure to obey a protective order in litigation over sudden acceleration.
U.S. District Judge James Selna has ordered Betsy Benjaminson to show cause why she should not be sanctioned and to appear in his Santa Ana, Calif., courtroom.

[gist of next paragraph: I am proposing to first give all of the electronics-related SUA documents to Independent Monitor David Kelley, and then I will eliminate them from this computer. Toyota has refused to agree to this proposal but has not said why.]
[Toyota claimed in its filings that all the docs were covered by the court protective order, but ] There exists “a bona fide dispute as to whether the vast majority of the Toyota documents in her possession are covered by the protective order, instead of a private contractual agreement with a translation company," her counsel, David Azar of Milberg argued. “That translation work started years before she was asked to sign the protective order, and ended months before she signed it in June 2012 in conjunction with starting work for a different translation agency.”
When Benjaminson worked for the first agency, it was on behalf of Debevoise & Plimpton, which represented Toyota while the government investigated the company for criminal liability.
“It was during that work .... that Benjaminson came to the belief that Toyota’s internal documents revealed that its public statements about sudden unintended acceleration did not match its statements to investigators, Congress, and the public about the important vehicle safety concerns at issue,” Azar wrote. “Benjaminson was no ‘rogue’ translator.”

Read more here.

Pretzel logic as an element in willful blindness--and how to report the straight truth

Tasty-looking. But twisted.

Yesterday, Sean Kane wrote one of the best blog posts ever on the Safety Research and Strategies website. He sets out some of the key points of the sorry, ongoing tale of consumer woe caused by the massively twisted "regulatory partnership" between NHTSA and Toyota, where pretzel logic prevails on the cause diagnosis for any and every SUA incident. No matter the evidence, this twisted logic always seems to produce a putative cause that is not electronic.

Sean's key question: If NHTSA doesn't have the brain power or the will to accurately pinpoint the causes of SUA incidents, or a defect, and if Independent Monitor David Kelley is not tasked with finding any "new, officially recognized" SUA related defects, but only tasked with determining Toyota's compliance with applicable laws and its DPA, then to what address can American consumers report SUA incidents, and why report them at all?

Sean is in the habit of telling the truth, harsh as that truth may be. So, to our sorrow, he does not offer a good answer to this question. He recommends that SUA victims report incidents to NHTSA and to Mr. Kelley anyway, despite the likely futility in the short term, because eventually it might do some good to have a record of events.

But maybe there is an answer. I suggest that perhaps Mr. Kelley might not need to establish an official government recognition of a defect. All he (and the prosecutors who stand behind him) may need to see is that Toyota was and still is willfully blind to the facts of Toyota's ongoing consumer fraud. What could happen if Mr. Kelley learned of a mountain of facts to which Toyota and, by inference, its executives, are obviously willfully blind? We don't really need NHTSA's official blessing on facts before they are recognized as facts, do we? Just because the DOJ cravenly relied on NHTSA (and Toyota's defense counsel) last time, it does not necessarily follow that they must rely on them this time. Does it? Remember, the federal judges in the SD NY, and even Eric Holder, are not at all happy that the DOJ has not been prosecuting executives, and they have been pretty vocal about that. Maybe prosecutors will listen carefully if enough facts are presented.

It bears noting that Toyota's officers have the power to learn any fact that is known within the company, and that includes driver descriptions of their SUA incidents, such as Mr. Pepski's and Mrs. Ruginis'. Am I correct in understanding that drivers are testifying? That is, their testimony can be taken seriously. If you are an SUA victim, I join with Sean in urging you to report your incident and Toyota's response.  Report early, thoroughly, if possible in the form of an affidavit written with the help of an attorney, and as many times as possible if no response is forthcoming. Best to do it in writing, but if you call, take notes.

Report to your dealer, to Jim Lentz at Toyota Motor [important!], to Mr. Kelley, and to NHTSA.

ToyotaMonitor [at] cahill.com

Jim_Lentz [at] toyota.com


Margaret Heffernan wrote a book on willful blindness. Its Amazon page is here. Two important quotes from the book's introduction:

*      *      *

Tuesday, September 23, 2014

Willful blindness to red flags

More than a few red flags.

From a defense law firm website:
Actual knowledge and willful blindness are not mutually exclusive; if the prosecutor presents sufficient evidence to support both, a jury can be charged on alternative theories of actual knowledge and willful blindness, giving the prosecutor two bites of the apple.

In willful blindness cases, white-collar prosecutors often point to “red flags” which they claim should have alerted the defendant to criminal activity. A failure to ask the right questions in the face of these clues can indicate deliberate avoidance of knowledge to a prosecutor, court or jury. 
From Columbia Law School CLS Blue Sky Blog:
The Supreme Court described the two basic requirements [of willful blindness] as:  the defendant must 
(i) subjectively believe that there is a high probability that a fact exists; and 
(ii) take deliberate actions to avoid learning of that fact.  
According to the Court, this two-pronged definition gives willful blindness “an appropriately limited scope that surpasses recklessness and negligence”.  Thus, in the context of fiduciary liability, we’re talking “bad faith”.

Now, how is this applied to Toyota?
Robert Ruginis, the husband of an SUA victim, writes to Mr. Kelley and quotes Toyota's "we are very good at turning a blind eye" letter:

"The accelerator pedal was thoroughly inspected and found to move smoothly with no 
restrictions or binding. There was no interference or obstruction found with the operation 
of the accelerator pedal. When the accelerator pedal was released it would always return 
to the idle position. The brake components were in good condition with no damage or 
leaks. The floor mat was properly anchored. The vehicle was test driven for 16 miles, at 
various speeds and road conditions with several accelerating and braking maneuvers 
being conducted and all systems performed properly with no unusual or unexpected 

reactions observed."

Toyota then said:
"Based on our inspection of your vehicle it has been determined the incident was not the result of any type of manufacturing or design defect.”

"I followed up with a company representative to ask about this obvious omission [of the damning EDR readout from the letter]. Toyota’s representative Ronald Inton, while conceding that the results of the EDR readout were not considered, refused to address the glaring conflict between the black box evidence, which contemporaneously affirmed my wife’s experience in the Corolla, and the inspector’s observations gathered on a short test drive."

Is this willful blindness?

Is it Toyota's intent?  ...if the incriminating EDR readout is not mentioned in the letter, it takes on a ghostly "unofficial"pallor, eventually fading from the legal landscape altogether.

Kudos to Mr. Ruginis for not allowing Toyota to get away with arranging that. 

Thou shalt not lie, Toyota

The specifics.

New defense counsel appointed, Hemant (Shashi) H. Kewalramani, after Dean Steward was appointed to death penalty case

Changing trains.

My appointed defense counsel, Dean Steward, asked the court to be relieved. As he said in his filings, he was just recently appointed to a 17-defendant racketeering and murder case, with his client facing the death penalty, and in addition he is preparing defense for an upcoming drug and money laundering jury trial and two fraud cases. He said he does not have time for me. I believe him. I am only facing Skadden, who, I am confident, will not ask for the death penalty at the contempt hearing. Although maybe they wish they could.

The new defense counsel is Hemant (Shashi) H. Kewalramani.

I am very happy to have such a respected attorney as my defense counsel.

Monday, September 22, 2014

Inherit the Wind - law and its place in maintaining a just and free society

"You cannot administer a wicked law impartially. You can only destroy.
A wicked law destroys everyone it touches...its upholders as well as its defiers.....
...Soon we will be marching backwards, to the 16th century, 
when burned a man who dared to bring enlightenment and intelligence to the human mind."

A few thoughts of a simple person: 

Censorship brings us to a slippery slope that ends in various forms of fascism. 
Free speech has the opposite effect and brings the public closer to true democracy.

When corporations take over the practical administration of censorship or freedom of speech, they can write pretty much anything they want into the private contracts that govern speech for each of their employees, contractors, and suppliers. These relate far less to law, and thus the transactions are less involved with law, than would be the case for states or communities.  Corporations can abolish freedom of speech within the domains that they control. Then they, as legal "persons," can defend their own free speech in the form of political donations and advertising. Human voices are silenced and distorted in this way.

Jim doesn't know, doesn't know, doesn't know, etc.

Jim looks for some answers but simply can't find them in his head.

House Energy & Commerce Committee hearing, February 23, 2010:

Mr. Dingell. Mr. Chairman, I thank you for your courtesy.
Mr. Lentz, please tell me the date that Toyota first heard of
incidents of sudden acceleration in its vehicles sold in the U.S.
Mr. Lentz. I don't know the answer to that.
Mr. Dingell. Please submit that to the record.
Mr. Dingell. Now, Mr. Lentz, please tell me the date on
which Toyota commenced the first recall to address this problem in
the United States?
Mr. Lentz. If I don't know the answer to the first one, I
don't know the answer to the second one.
Mr. Dingell. Please submit that for the record.

Mr. Dingell. I just want an answer, not a speech.
Now, since 2001, how many complaints of sudden unintended
acceleration in vehicles sold in the United States has Toyota
Motor Sales USA received?
Mr. Lentz. I don't know that number.
Mr. Dingell. Please submit that for the record.
Mr. Dingell. How many of those complaints has Toyota Motor
Sales USA forwarded to NHTSA?
Mr. Lentz. I don't know that number.
Mr. Dingell. Please submit that for the record.

Mr. Dingell. Now, Mr. Lentz, yes or no, did NHTSA require
Toyota in 2006 to conduct the tests on electronic throttle
components for a 2006 Camry?
Mr. Lentz. Could you repeat the question?
Mr. Dingell. Did NHTSA require Toyota in 2006 to conduct a
test on an electronic throttle component for a 2006 Camry?
Mr. Lentz. I don't know the answer to that.
Mr. Dingell. Please submit the answer for the record. Now
Mr. Lentz, if so, did Toyota or a designated third party conduct
the tests?
Mr. Lentz. I don't know the answer to that.
Mr. Lentz. I am not responsible for manufacturing. I am not
responsible for defect or quality decisions. Defect decisions,
recalls specifically, are, in fact, made in Japan. 

Is it fair to say that Jim is not the best witness? At least for the people. For Toyota, he is the best.
Where are the "answers for the record?"

Jim Lentz doesn't know.

Jim, not this exit.

Representative DeGette questions Jim on February 23, 2010:

Ms. DeGette. I want to ask you a couple of questions. The
first one is, you just told Mr. Markey that this is not the first
time that you folks have looked at the ETCS, and you folks
provided a number of documents in response to our February 2,
2010, request. As far as you know, has Toyota provided all of the
documents relating to previous tests of the ETCS?

Mr. Lentz. Again, I can't you if it's a test or it's just
the development cycle of the ETCS.


Ms. DeGette. I mean, we know that you have provided
thousands of pages of documents relating to the development. What
we want to know is, are there additional documents relating to the
testing of the ETCS that you just testified that you folks that
it's not the first time that you have looked at it. And I want to
know, are have we received all of the documents relating to
previous testing of the ETCS? Because that's what we care about
Mr. Lentz. I understand. I have to check. I don't know
Ms. DeGette. If there are additional documents, will you
provide us those to this committee?
Mr. Lentz. Of course. Of course.
Ms. DeGette. Thank you. Now the only document that Toyota
has produced to us that we've seen that claims to address the
phenomenon of sudden unintended acceleration is this February 2010
report that we've been talking about that was conducted by
Exponent. My first question is, that report was commissioned in
December of 2009 just 2 months ago by Toyota's defense attorney
Bowman & Brooke, correct?
Mr. Lentz. Yes, I believe so.


In many such interchanges, members of Congress asked Jim for documents and answers to be supplied later. But where are they? The public deserves to see the answers.

Why Jim Lentz may not know about overseas recalls

Transcript of Jim Lentz sworn testimony before the House Energy & Commerce Committee, February 23, 2010

Mr. Markey. Thank you, Mr. Chairman. Mr. Lentz, it seems to
me that Toyota got the first dilemma back in 2000 when the British
ordered a Lexus recall due to acceleration problems. Toyota got a
second alarm back in 2003 with the Canadian recall. Toyota is a
global corporation. Those two alarm bells should have sent your
engineers scrambling to figure out what was wrong and what was
needed to be done to fix the problems. Instead, the same types of
problems cropped up in additional Toyota models, resulting in the
recalls that bring you here today.
So instead of deploying your engineers after Toyota got those
early warnings in 2000 and 2003, they waited until problems
cropped up in the United States, and then Toyota deployed lawyers
and lobbyists to convince the Department of Transportation that
this was a small floor mat issue and not something more serious.
And that, Mr. Lentz, has done a disservice to Toyota's customers
and ultimately also to Toyota's dealers and to Toyota's employees.
So according to documents obtained by my office, Toyota recalled a
Lexus in the United Kingdom in 2000 and a Celica in Canada in 2003
because of floor mats were entrapping the accelerator pedal and
the exact same problem that has caused fatalities in this country.
Why didn't Toyota take immediate action to prevent the much later
accidents when Toyota clearly knew the problem existed as far back
as 2000?
Mr. Lentz. Specifically on those two incidences, I can't
tell you the specifics of those because I do not know. But I can
tell you that a weakness in our system has been that within this
company, we didn't do a very good job of sharing information
across the globe. Most of the information was one way. It would
flow from the regional markets, like the United States, Canada or
Europe back to Japan.
Mr. Markey. So what you are saying is that ultimately the
decisions are made in Japan and that notwithstanding problems that
are identified in the United Kingdom, in Canada, the information
goes back to Toyota headquarters in Tokyo and whether or not you,
in America, are given orders to correct the problem identified in
other countries, is not in your hands, is that what you are
Mr. Lentz. Correct.

Now Jim goes on to say that "things are changing" and they are setting up a global quality control committee under the direct supervision of Akio-kun.

However, this global committee has not uttered one public word in English in the four years since the hoopla of its setup. What has it been doing? To whom is it accountable? Certainly not the public. If it were really operational, and if global models are similar, as we can presume that they are according to Jim's testimony, maybe the Saudi recalls for sudden acceleration and for BOS and cruise control malfunctions would have already expanded to the United States to help ensure the safety of US customers. They haven't, and no one knows just why.

Jim says he is responsible for sales but not for quality.

Sunday, September 21, 2014


Federal Judge Jed S. Rakoff writes brilliant article on the reasons behind non-prosecution of corporate executives

Iniustitia, iniuria (injustice and harm)

Judge Rakoff is in the Southern District of New York.
His views pertain to the prosecution of the perpetrators of the frauds that led to the 2008 financial crisis, but there are stunning parallels to the Toyota case.

Here are some applicable excerpts from his excellent article:
"The [DOJ] position has been to excuse their failure to prosecute high-level individuals for fraud in connection with the financial crisis on one or more of three grounds:
First, they have argued that proving fraudulent intent on the part of the high-level management of the banks and companies involved has been difficult. It is undoubtedly true that the ranks of top management were several levels removed from those who were putting together the collateralized debt obligations and other securities offerings that were based on dubious mortgages; and the people generating the mortgages themselves were often at other companies and thus even further removed."
"But what I do find surprising is that the Department of Justice should view the proving of intent as so difficult in this case. Who, for example, was generating the so-called “suspicious activity reports” of mortgage fraud that, as mentioned, increased so hugely in the years leading up to the crisis? Why, the banks themselves. A top-level banker, one might argue, confronted with growing evidence from his own and other banks that mortgage fraud was increasing, might have inquired why his bank’s mortgage-based securities continued to receive AAA ratings. And if, despite these and other reports of suspicious activity, the executive failed to make such inquiries, might it be because he did not want to know what such inquiries would reveal?
This, of course, is what is known in the law as “willful blindness” or “conscious disregard.” It is a well-established basis on which federal prosecutors have asked juries to infer intent, including in cases involving complexities, such as accounting rules, at least as esoteric as those involved in the events leading up to the financial crisis. And while some federal courts have occasionally expressed qualifications about the use of the willful blindness approach to prove intent, the Supreme Court has consistently approved it. As that Court stated most recently in Global-Tech Appliances, Inc. v. SEB S.A. (2011):
The doctrine of willful blindness is well established in criminal law. Many criminal statutes require proof that a defendant acted knowingly or willfully, and courts applying the doctrine of willful blindness hold that defendants cannot escape the reach of these statutes by deliberately shielding themselves from clear evidence of critical facts that are strongly suggested by the circumstances.
Thus, the department’s claim that proving intent in the financial crisis is particularly difficult may strike some as doubtful."
"The Department of Justice has sometimes argued that it might be difficult to prove reliance."
[But] "In actuality, in a criminal fraud case the government is never required to prove—ever—that one party to a transaction relied on the word of another."
"The law says that society is harmed when a seller purposely lies about a material fact, even if the immediate purchaser does not rely on that particular fact, because such misrepresentations create problems for the market as a whole."
"The department has sometimes [given a reason] for not bringing these prosecutions is that to do so would itself harm the economy. "

"To a federal judge, who takes an oath to apply the law equally to rich and to poor, this excuse—sometimes labeled the “too big to jail” excuse—is disturbing, frankly, in what it says about the department’s apparent disregard for equality under the law." and
"If we are talking about prosecuting individuals, the excuse becomes entirely irrelevant; for no one that I know of has ever contended that a big financial institution would collapse if one or more of its high-level executives were prosecuted, as opposed to the institution itself."

Some other reasons:
"First, the prosecutors had other priorities."
"The government, writ large, had a part in creating the conditions that encouraged the approval of dubious mortgages." [-> this might also be said about unsafe auto electronics]

"It was the government, pretty much across the board, that acquiesced in the ever-greater tendency not to require meaningful documentation" of mortgage qualifications" [yup, also -> safety defects]

 "[Such] mortages later became known as 'liars’ loans.'” [so, duh, let's mention NHTSA here.]

 "what I am suggesting is that the government was deeply involved, from beginning to end, in helping create the conditions that could lead to such fraud, and that this would give a prudent prosecutor pause in deciding whether to indict a CEO who might, with some justice, claim that he was only doing what he fairly believed the government wanted him to do."

Judge Rakoff's most important point is here, and it is the most relevant to Toyota, because THIS COMPANY PROSECUTION APPROACH IS WHAT HAPPENED. The law firm involved was Debevoise & Plimpton, and I worked for them. 

"If you are a prosecutor attempting to discover the individuals responsible for an apparent financial fraud, you go about your business in much the same way you go after mobsters or drug kingpins: you start at the bottom and, over many months or years, slowly work your way up. Specifically, you start by “flipping” some lower- or mid-level participant in the fraud who you can show was directly responsible for making one or more false material misrepresentations but who is willing to cooperate, and maybe even “wear a wire”—i.e., secretly record his colleagues—in order to reduce his sentence. With his help, and aided by the substantial prison penalties now available in white-collar cases, you go up the ladder.
But if your priority is prosecuting the company, a different scenario takes place. Early in the investigation, you invite in counsel to the company and explain to him or her why you suspect fraud. He or she responds by assuring you that the company wants to cooperate and do the right thing, and to that end the company has hired a former assistant US attorney, now a partner at a respected law firm, to do an internal investigation. The company’s counsel asks you to defer your investigation until the company’s own internal investigation is completed, on the condition that the company will share its results with you. In order to save time and resources, you agree.
Six months later the company’s counsel returns, with a detailed report showing that mistakes were made but that the company is now intent on correcting them. You and the company then agree that the company will enter into a deferred prosecution agreement that couples some immediate fines with the imposition of expensive but internal prophylactic measures. For all practical purposes the case is now over. You are happy because you believe that you have helped prevent future crimes; the company is happy because it has avoided a devastating indictment; and perhaps the happiest of all are the executives, or former executives, who actually committed the underlying misconduct, for they are left untouched.
I suggest that this is not the best way to proceed."

The article is well worth reading in its entirety.

Woman dies after Camry crashes into wall, NSW Australia

A wall.

NSW Police Force

12/09/2014 | Press release

A woman dies after car crash - Randwick

distributed by noodls on 13/09/2014 00:21
0 0
Friday, 12 September 2014 10:28:35 PM
Police will prepare a report for the Coroner after a single vehicle crash at Randwick
Just after 9pm (Friday 12 September 2014), emergency services responded to reports of a car crash in a shopping centre car park on Avoca Street, Randwick.
On arrival, officers from Eastern Beaches Local Area Command found a Toyota Camry had crashed into a wall at the location.
The sole occupant, a woman believed to be aged in her 70's, died at the scene.
An investigation into the circumstances surrounding the crash is underway.
Investigators would like anyone who may have witnessed the incident and has not yet spoken to the police, to make contact.
Police are urging anyone with information about this incident to call Crime Stoppers on 1800 333 000 or use the Crime Stoppers online reporting page: https://nsw.crimestoppers.com.au/Information you provide will be treated in the strictest of confidence. We remind people they should not report crime information via our Facebook and Twitter pages.
- See more at: http://www.noodls.com/view/E5E6B0C36ACCBE19FB572E65AA8C315A393FB654?4409xxx1410556749#sthash.S69bqoqM.dpuf

Toyota alleged to steal unprotected trade secrets after not agreeing to keep them secret; cleared by jury

Where are we?
Toyota's conduct in this case seems to me to be right in line with much of what the company appears to be doing elsewhere in its dealing with victims, Congress, NHTSA, and the DOJ: Technically legal it may be, but at the same time ethically questionable. And the PR department takes care of the perception.
"Toyota Motor Sales USA has been cleared of allegations that the company stole trade secrets from a Dallas market research firm, according to a legal industry publicationA Texas federal jury on Thursday cleared Toyota Motor Sales USA Inc. of misappropriating Rincon & Associates LLC’s proprietary methods for conducting a study of minority car buyers' preferences and habits.
The jury found Toyota never agreed to keep confidential the techniques Rincon uses to study the car-buying habits of Asian, Hispanic and African-American consumers, according to Law360.
Rincon handled research projects for Toyota in 2007 that included gathering the data. Rincon alleged that instead of renewing its contract to conduct a subsequent study, the automaker took its proprietary methodology and gave the contract to a different firm."

If Toyota corporate culture permits the [alleged] taking of proprietary business techniques simply because their owner had not signed a suitably protective contract...to me, that appears to be resoundingly unethical, but the jury said it was legal. The unethical conduct suggests a cavalier win-lose attitude with this supplier. In terms of Jewish ethics, Toyota has taken the position of saying "what is mine is mine, and what is yours is also mine." Maybe it suggests that TMA is in the yellow zone in the illustration above. What kind of example does this behavior give to the company's safety and products liability people? Although the conduct occurred way back in 2007, Toyota has been fighting this lawsuit all these years until now, almost undoubtedly because they thought that they could win. And they did, ethics be damned. So it sounds like their ethical awareness and conduct may not have improved since 2007. That's a serious question because it impacts public safety.
Based on everything I have learned about Toyota's behavior during the SUA recalls crisis, I think that there are at least some aspects, perhaps mainly in Japan, where Toyota's culture has been well into the red zone. I think that deterring this conduct for the sake of public safety requires strong external forces such as criminal penalities for executives. Maybe what is needed is a provision in auto safety legislation that forces automakers to designate a senior executive to sign off as the person responsible for product safety, similar to the executive sign-offs required for SEC filings. That way, we can avoid the problem, recently described by U.S. Attorney General Eric Holder, of the diffuse nature of executive responsibilities preventing prosecution for intentional deceit about safety defects. He questioned the adequacy of current law.

Here is an excerpt of Mr. Holder's remarks as quoted in the article For Some Big Companies, the Buck Stops Nowhere, in Corporate Crime Reporter. He is primarily referring to prosecution of financial executives, but I think it applies to executives in any large corporation charged with fraud:

“When it comes to more complex transactions ... a criminal prosecution of an individual can be difficult, more complicated, to mount,” Holder said.
“This is true for any number of reasons – from possible advice-of-counsel defenses, to the adequacy or inadequacy of written disclosures, to the difficulty to establish materiality and intent.”
“And in some instances, it is simply not possible to establish knowledge of a particular scheme on the part of a high-ranking executive who is far removed from a firm’s day-to-day operations.”
“This has been a source of frustration for the public for a long time,” Holder acknowledged.  “I understand and share that frustration. But despite the commitment and tireless work of our prosecutors, we cannot bring cases unless, based upon the facts and the law, we believe that we are likely to succeed in court. That is consistent with the department’s long-standing principles of federal prosecution.”
“We must look deeper at these questions and several thoughts come to mind.”
“First, in an age when corporations are structured to blur lines of authority and prevent responsibility for individual business decisions from residing with a single person, we ought to consider whether the law provides an adequate means to hold the decision-makers at these firms properly accountable.”