LANSING, Mich. (Legal Newsline) — Michigan Attorney General Bill Schuette announced Feb. 22 that TK Holdings Inc., the U.S. subsidiary of Takata, will settle multistate allegations of concealing safety issues with airbag systems that were installed in numerous vehicles sold to U.S. consumers.

Forty-four states and the District of Columbia were involved in the settlement and are entitled to a stipulated civil penalty of $650 million. TK Holdings, however, is in the middle of bankruptcy proceedings. The settling parties therefore agreed to subordinate the penalty in order to provide as much as possible in refunds to consumers victimized by the airbag defect.

“The safety of consumers is one of my top priorities as your attorney general,” Schuette said in a statement. “That’s why I crack down on companies that lack transparency to the consumer, especially when it directly effects their safety.”

According to the multistate lawsuit, TK Holdings manipulated data and submitted false and misleading reports to auto manufacturers about the safety of its airbags. More than 50 million airbags and 37 million vehicles were allegedly sold to consumers with defects.

In Michigan, TK Holdings purportedly violated the Michigan Consumer Protection Act.

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