Crushing Legal Defeat for Toyota Whistleblower

Dimitri Biller must pay Toyota $2.6 million, return documents.

Jan. 6, 2011 — -- Toyota has won a big legal victory against one of its former top lawyers who had accused the automaker of deliberately hiding evidence of vehicle safety defects. An arbitrator has ruled that Dimitri Biller violated his confidentiality agreement with Toyota by taking thousands of internal documents with him when he left Toyota and for disclosing the information to the public.

The arbitrator, retired judge Gary Taylor, ruled that Biller must pay a $2.6 million judgment to Toyota and return the boxes of documents that he took from the company. The arbitrator's ruling was revealed in a statement issued by Toyota yesterday and hailed as a decisive victory by the automaker. The ruling left unclear the status of copies of the documents that Biller gave to outside parties, including Congressional investigators and lawyers in Texas who are suing Toyota.

"We believe that the Arbitrator's award clearly vindicates Toyota's position and reaffirms the critical importance of attorney-client privilege as a cornerstone of our legal system," said Christopher P. Reynolds, General Counsel of Toyota Motor Sales, in the statement. "Throughout this process, Mr. Biller has continuously made misleading and inaccurate allegations about Toyota's conduct, and we feel this award is an appropriate consequence for his actions and completely discredits his meritless attacks on our company and our people," said Reynolds.

Biller told ABC News that he was "very disappointed" by the ruling and disagreed with it, but would respect the arbitrator's decision.

Biller served as managing counsel for Toyota's U.S. operations from 2003 to 2007. In an interview with ABC News last February, Biller claimed that Toyota hid evidence of safety defects and fostered a culture of "hypocrisy and deceit." Biller told ABC that he has four boxes worth of documents that he claims were deliberately withheld from plaintiff's lawyers suing Toyota in product liability lawsuits, despite court orders that required the automaker to disclose the information.

"They were hiding evidence, concealing evidence, destroying evidence, obstructing evidence," said Biller.

The arbitration case arose after Toyota sued Biller for violating the terms of his confidentiality agreement with the company after he left in 2007. Biller countersued, alleging that attorney-client confidentiality was void in his case because Toyota had violated racketeering (RICO) laws by hiding product defect information. While Taylor did not rule specifically on the merits of Biller's allegations against Toyota, he dismissed the RICO claim as well as Biller's complaint that Toyota had intentionally inflicted emotional distress on him.

Biller furnished copies of his documents to litigators in Texas who are suing Toyota over vehicle rollover incidents. The documents were also subpoenaed by the House Committee on Oversight and Government Reform as part of the investigation and hearings into the Toyota sudden unintended acceleration issue. The ruling did not indicate whether those copies would need to be returned to Toyota .

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