I tried reseting the code several times and it came back. It was impossible to get the sensor out of the manifold without screwing up the threads. It was seized in really bad (car has 120k+ miles). My mechanic and myself tried to replace it ourselves but couldn't get it out thats the reason I went to Lexus.
They warned me that the threads might be ruined and new manifold will be needed before installing new sensor... And it happened, but Lexus still covered the cost of the manifold. Now, how did they screw up the front pipe assembly no idea.

 

Seems like some WD-40 could have been sprayed where the O2 sensor screws in, and let to sit overnight and maybe the sensor would have came out with wrecking stuff.

What's the front pipe assembly?

Where the manifold ties into the rest of the exhaust system?