U.S. judge may tap Feinberg to run $1 billion Takata compensation fund
A federal judge may tap attorney and longtime compensation adviser Kenneth Feinberg to oversee claims for nearly $1 billion that Takata Corp (7312.T) will pay out to victims of defective air bag inflators linked to numerous deaths and injuries, court officials said on Monday.
In April, U.S. District Judge George Caram Steeh said he planned to name former Federal Bureau of Investigation director Robert Mueller to oversee the Takata settlement funds. But Mueller resigned from his law firm last month to head the Justice Department's probe into Russian interference in the 2016 election and told Steeh he could no longer accept the Takata assignment.
Takata, which is based in Tokyo, is one of the world's largest automotive suppliers. It pleaded guilty in February in federal court in Detroit to fraud charges as part of a settlement agreement with the U.S. government over massive recalls stemming from the faulty air bag inflators.
The devices can explode with excessive force, unleashing metal shrapnel inside cars and trucks. They have been blamed for at least 16 deaths and more than 180 injuries worldwide.
The Takata settlement includes a $25 million criminal fine, $125 million in victim compensation and $850 million to compensate automakers who have suffered losses from massive recalls.
The Justice Department in January recommended Feinberg to oversee the Takata settlement payout. A specialist in mediation and dispute resolution, he previously oversaw the Sept. 11 attacks compensation fund, the BP (BP.L) oil spill fund and compensation paid by General Motors Co (GM.N) to victims of its faulty ignition switches.
Feinberg said Monday he had not spoken recently to Judge Steeh and was unaware of any decision on who will serve as the monitor. Steeh has made no final decision on who will serve as monitor following Mueller's withdrawal, his office said Monday.
"Bob Mueller took an extraordinary monetary loss to drop this assignment and willingly gave up fees that would have amounted to millions of dollars to accept the Justice Department’s Special Counsel appointment," Steeh said in a statement.
Inflator recalls began around 2008 and involve around 100 million inflators around the world used in vehicles made by 19 automakers, including Honda Motor Co (7267.T), Volkswagen AG (VOWG_p.DE) and GM.
Takata is seeking financial backers as it faces potentially billions of dollars in recall-associated costs.