Three former Takata Corp. employees calling themselves whistleblowers settled a legal battle over $850 million the supplier of exploding air bags owes to car companies shouldering costs for unprecedented safety recalls.
The former employees reached a settlement this week with the Japanese automotive supplier that would end their attempt to freeze $255 million of a legally mandated restitution fund for car companies, people familiar with the discussions said.
In exchange for dropping their pursuit of the auto makers’ restitution, the former Takata employees are expected to be considered among other creditors for a potential financial recovery in the supplier’s U.S. bankruptcy case, the people said.
The settlement is expected to be outlined in court documents in coming days, the people said. Lawyers were still in the process of signing settlement documents on Thursday that will require a bankruptcy judge’s approval, so a deal isn’t guaranteed, they said.