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SAN DIEGO — A class action securities lawsuit, Squires v Toyota Motor Corporation, et. al., has been filed in the U.S. District Court for the Central District of California, Western Division, seeking damages for violations of the Securities Exchange Act of 1934 to benefit purchasers of Toyota Motor Corp. publicly traded securities from Dec. 22, 2006, through Feb. 2, 2010, it was announced Feb. 26. The lawsuit extends to purchasers of Toyota American Depositary Shares (ADS) and Toyota common stock.
The complaint names Toyota Motor Corp., Toyota Motor North America Inc., Toyota Motor Sales U.S.A. Inc. and certain officers and directors of these companies as defendants. The complaint alleges that during the class period, defendants issued materially false and misleading statements regarding the company's operations with regard to vehicle quality, safety and business outlook. The complaint states that Toyota failed to disclose serious safety and quality control issues regarding Toyota automobiles. As a result of defendants' false statements, Toyota's securities traded at artificially inflated prices during the class period, it says.
According to the lawsuit:
On Jan. 21, 2010, Toyota announced a massive recall of eight different vehicle models relating to defective accelerator pedals. On Jan. 26, 2010, Toyota announced that it was halting the sale of these models as a result of the accelerator pedal defect and that the company was shutting down its North American assembly lines for one week beginning Feb. 1, 2010. As a result, Toyota's ADSs dropped $7.01 per share to close at $79.77 per share on Jan. 27, 2010, a drop of more than 8 percent. Toyota common shares dropped more than 4 percent. On Feb. 2, 2010, after the market closed, Toyota reported that its U.S. sales for January 2010 had dropped 16 percent from a year ago due to the recall and subsequent suspension of sales. As a result of this news, Toyota's ADSs fell $4.69 per share, closing at $73.49 per share on Feb. 3, 2010, a decline of 6 percent. Toyota's common stock also dropped approximately 6 percent.
Plaintiff seeks to recover losses of all persons who purchased or acquired the securities during the class period. Plaintiff is represented by Finkelstein & Krinsk LLP.
Class members have until April 9 to move to serve as lead plaintiff for the class.