Toyota Motor Corp. investors, including the $44.2 billion Massachusetts Pension Reserves Investment Management Board, Boston, are vying to become lead plaintiffs in a group of securities class-action lawsuits that allege the automaker failed to disclose design flaws that might cause its cars to suddenly accelerate.
U.S. District Court Judge Dale S. Fischer at a hearing Monday in Los Angeles said she will hold off making a decision until the U.S. Supreme Court issues its ruling in a lawsuit against National Australia Bank, which may limit the ability of foreign investors to use American courts to sue companies based abroad. The Supreme Court heard arguments in that case in March.
The Toyota investor with the largest loss among the plaintiffs before Ms. Fischer is Skandia Life Insurance, a Swedish company, which claims it lost $34.9 million. Investors who have the most at stake financially are given preference to be appointed lead plaintiff in securities class-action cases.
Ms. Fischer asked lawyers in an April 23 order to explain why they were representing groups of investors, rather than individual ones, if not for the sole purpose to create a larger loss figure and have their group be appointed lead plaintiff.
Gerald Silk, a lawyer for a group of five institutional investors including the $33.7 billion Maryland State Retirement and Pension System, Baltimore, who together claim $91.8 million in losses, said his clients had come together on their own.
“This group was formed organically,” Mr. Silk told the judge. “They are not the types of people we could control.”
The Toyota investors claim the carmaker misled them by not disclosing flaws in the acceleration system that prompted a recall of 2.3 million vehicles in North America in January.
Toyota faces more than 300 lawsuits in state and federal court, including proposed class actions over economic losses and claims of personal injuries or deaths caused by sudden-acceleration incidents.
