The U.S. Bankruptcy Court for the District of Delaware has approved a bankruptcy plan carving out a trust for personal injury claimants against Takata and Honda as well as a second channeling agreement allowing for future claims in cases involving defective airbags. The airbags, at the center of the largest automobile recall in history, have been linked to at least 22 deaths and 180 injuries worldwide.One resolution is with TK Holdings Inc. and the other with Honda North America, Inc. The resolutions will be available to all U.S. personal injury and wrongful death victims. Plaintiffs have the option to opt out and file litigation through the tort system if they feel their claim is not fair.The estimated value of the trust is $90 million to $137 million. This amount may increase, but will not decrease.
Once the trust is open, it would begin to accept claims in approximately mid-2018. Honda will pay 100 percent of compensatory damages without any credit for fault placed on Takata, third parties or the victims. Honda also has agreed to pay regardless of the age of the car or the expiration of a statute of limitations. Defenses that may be used in the tort system by an OEM, such as not acting on a recall letter or driving violations, are waived under this settlement. Additionally, the settlement values have punitive damages built in based on known, prior settlement values in other cases.