A Judge Just Put Hundreds of GM Ignition Lawsuits Back On the Books
General Motors had hoped to put the issue behind it, but a judge’s ruling just opened the automaker up to billions in damages over its faulty ignition switch scandal.
Yesterday, the U.S. Appeals Court of Manhattan ruled that lawsuits filed against the automaker for accidents that happened before the company’s 2009 bankruptcy sale were still valid. The decision overruled an earlier court decision that protected GM from such suits.
Now, the automaker could face lawsuits not just from accident victims, but owners whose vehicles depreciated in value when the issue was discovered. Faulty ignition switches in past GM vehicles are linked to 124 deaths. Following a recall of affected models, the automaker paid out $2 billion in legal expenses.
In its ruling, the court claimed GM’s transition into a new company after the bankruptcy didn’t take away its past responsibility:
While the desire to move through bankruptcy as expeditiously as possible was laudable, Old GMʹs precarious situation and the need for speed did not obviate basic constitutional principles. Due process applies even in a company’s moment of crisis.
GM won two key legal challenges earlier this year, and it looked like the automaker was going to pull away from the issue. Yesterday’s ruling means up to 300 lawsuits are back on the books, leaving GM on the hook for up to $10 billion in damages.
Jim Cain, a GM spokesperson quoted by Bloomberg, said that despite the ruling, it’s still up to plaintiffs to prove themselves in court.
“There is no basis for plaintiffs to claim diminution in value because the majority of them did not experience a defect in their vehicle and because GM has provided recall repairs that eliminated the defect,” he said.
Many victims accuse GM of using the bankruptcy to side-step responsibility in the scandal. After a long wait, it now looks like they’ll get their day in court.
Join the conversation
Latest Car ReviewsRead more
Latest Product ReviewsRead more
- Donald More stuff to break god I love having a nanny in my truck... find a good tuner and you can remove most of the stupid stuff they add like this and auto park when the doors open stupid stuff like that
- John Williams Sounds like a Burnout Special you can put together on any 5.0 F150. Whoever said this was Cars and Coffee bait is right on the money.
- ToolGuy Question: F-150 FP700 ( Bronze or Black) supercharger kit is legal in 50 states, while the Mustang supercharger kit is banned in California -- why??
- Scott "It may not be the ideal hauler to take the clan cross-country to Wally World considering range anxiety "Range Anxiety is a chosen term that conceals as much as it discloses. You don't care about range that much if you can recharge quickly and current BV's (battery vehicles) can't, no matter how good the chargers are. From what I've been reading it is likely that within 5 years there will be batteries in cars, most likely Tesla's, that can charge fast enough with no harm to the batteries to satisfy all of us with no need to increase range beyond a real world 300-ish miles.And that's when I buy one.
- Charles I had one and loved it . Seated 7 people . Easy to park , great van
Now if they will just apply this reasoning to the GM Bond holders that Obama screwed in the bankrupt hearings things would start to look sunny.
I need to tell a buddy about this. He already won the lottery by being a passenger in my vehicle when a clown hit me head on. He was sore but got a nice check from my insurance company and after all the fees pit a,nicec15k in the bank for just riding along. No reason he shouldn't win again since he has a Cobalt SS.