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Regulators Hired by Toyota Helped Halt Investigations

With assistance from Andrew Harris – Fri Feb 12, 3:58 am ET

Feb. 12 (Bloomberg) -- Former regulators hired by Toyota Motor Corp. helped end at least four U.S. investigations of unintended acceleration by company vehicles in the last decade, warding off possible recalls, court and government records show.

Christopher Tinto, vice president of regulatory affairs in Toyota's Washington office, and Christopher Santucci, who works for Tinto, helped persuade the National Highway Traffic Safety Administration to end probes including those of 2002-2003 Toyota Camrys and Solaras, court documents show. Both men joined Toyota directly from NHTSA, Tinto in 1994 and Santucci in 2003.

While all automakers have employees who handle NHTSA issues, Toyota may be alone among the major companies in employing former agency staffers to do so. Spokesmen for General Motors Co., Ford Motor Co., Chrysler Group LLC and Honda Motor Co. all say their companies have no ex-NHTSA people who deal with the agency on defects.

Possible links between Toyota and NHTSA may fuel mounting criticism of their handling of defects in Toyota and Lexus models tied to 19 deaths between 2004 and 2009. Three congressional committees have scheduled hearings on the recalls.

"Toyota bamboozled NHTSA or NHTSA was bamboozled by itself," said Joan Claybrook, an auto safety advocate and former NHTSA administrator in the Jimmy Carter administration. "I think there is going to be a lot of heat on NHTSA over this."

‘Discussed Scope’

In one example of the Toyota aides' role, Santucci testified in a Michigan lawsuit that the company and NHTSA discussed limiting an examination of unintended acceleration complaints to incidents lasting less than a second.

“We discussed the scope” of the investigation, Santucci testified. “NHTSA’s concerns about the scope ultimately led to a decision by the agency to reduce that scope. You say it worked out well for Toyota, I think it worked out well for both the agency and Toyota.”

In an e-mailed response to questions about possible influence of former NHTSA employees on agency Toyota decisions, Transportation Department spokeswoman Olivia Alair said NHTSA “currently has three open investigations involving Toyota and is monitoring two major safety recalls involving Toyota vehicles. NHTSA’s record reflects that safety is its singular priority.”

Toyota City, Japan-based Toyota on Jan. 21 recalled 2.3 million U.S. cars and trucks with a potentially defective accelerator pedals. That followed Toyota’s decision in November to recall 4.48 million vehicles in the U.S. and Canada because floor mats might trap gas pedals while they were depressed.

Since that recall, Toyota's shares have dropped 17 percent, wiping out $27.7 billion in market capitalization. The stock rose 2 percent to 3,460 yen at the close of trading in Tokyo today.

Electronics Probe

Combined worldwide recalls for pedals, floor mats and a software fix to adjust brakes on the Prius and other hybrid models rose to more than 8 million vehicles as of Feb. 8.

"A recall is bad for any automaker because they have to admit there's a defect in their vehicle and the repairs can be expensive," said Rebecca Lindland, a forecaster at IHS Global Insight Inc. in Lexington, Massachusetts.

In Toyota's case, “the company has built itself on pillars of safety, quality and reliability,” she said. “A defect in their product is appalling to them, sort of unthinkable.”

All four of the probes the Toyota aides helped end were into complaints that the unintended acceleration was caused by flaws in the vehicles' electronic throttle systems. Toyota has denied that the system is a problem. U.S. Transportation Secretary Ray LaHood said on Feb. 3 that NHTSA is reviewing the electronics.

Toyota spokeswoman Martha Voss declined to make Santucci and Tinto available for comment.

‘Highest Standards’

“Anything Mr. Tinto and Mr. Santucci did was in the interest of full disclosure, transparency and openness with regulators and safety experts,” Voss said in an e-mailed statement.

“Their actions have been consistent with our efforts to maintain the highest professional and ethical standards in all of our legal and regulatory practices. Their paramount concern was for the safety of every single owner of one of our vehicles.”

The NHTSA decisions on Toyota weren’t necessarily biased just because former agency people were involved, said Sidney Shapiro, a law professor at Wake Forest University in Winston- Salem, North Carolina.

“I’m not sure regulators set out to say ‘I’m going to give a special deal to my old friends in the auto industry,’” he said. “But what happens is it just sort of deteriorates because these are the only people you talk to.”

Opposite Sides

There are no waiting-period requirements for moves to a company from its regulator for lower-level positions like those of Tinto and Santucci, said Allan Kam, former NHTSA senior enforcement attorney, who retired in 2000 after 25 years and said he was a “mentor” to Tinto at the agency. Santucci came to NHTSA after Kam’s retirement.

“They’re not supposed to deal with the agency about a matter they dealt with at the agency,” he said. Neither former NHTSA employee testified to any such conflicts when asked by attorneys.

Tinto, 46, came to Toyota after about four years at NHTSA. He hired Santucci from NHTSA in 2003, after the two met on opposite sides of the table in defect investigation cases, Santucci said in a deposition in the Michigan lawsuit.

Santucci, 39, works on most of the automaker’s recall petitions, he said in the deposition. In last year’s floor-mat recall, Santucci said he helped write Toyota’s explanation of the remedy and had phone calls and meetings with NHTSA to describe the automaker’s plans.

Cases Closed

NHTSA opened eight investigations of unintended acceleration of Toyota vehicles from 2003 to 2010, according to Safety Research & Strategies Inc., a Rehoboth, Massachusetts, group that gathers data from NHTSA and other sources for plaintiff’s attorneys and consumers. Three of the probes resulted in recalls for floor mats. Five were closed, meaning NHTSA found no evidence of a defect.

In four of the five cases that were closed, Tinto and Santucci worked with NHTSA on Toyota’s responses to the consumer complaints the agency was investigating, agency documents show.

The first closed case where NHTSA records show the involvement of Tinto and Santucci dealt with unanticipated acceleration by 2002 and 2003 Toyota Camrys and Solaras. The case, opened in March 2004, was the one Santucci testified about when he discussed limiting the scope of the probe. He did so in a deposition for a lawsuit filed on behalf of a Michigan woman who was killed in an April 2008 accident.

‘Blew Past’ Intersection

In that lawsuit, the family of Guadalupe Alberto, 76, says she died when her 2005 Toyota Camry sped out of control and crashed into a tree. The lawsuit blames a defect in the electronic throttle control, said attorney Edgar Heiskell, who represents the Alberto family.

“She blew past an intersection, witnesses saw her with both hands on the wheel,” Heiskell said. “She appeared to be standing on the brake while steering.”

On March 3, 2004, the agency told Toyota it was opening a preliminary investigation to determine “if the throttle control system could be the cause of vehicle surge or unwanted acceleration.”

Santucci and Tinto worked with Santucci’s former NHTSA co- workers, Scott Yon and Jeffrey Quandt, on the investigation, Santucci testified in his deposition. Yon and Quandt weren’t available for comment, Alair of the Transportation Department said.

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