GM Files Motion to Protest Itself in Ignition Switch Vehicle Recall Lawsuits

General Motors filed a motion in US court to bar personal injury lawsuits against the company based on the automotive manufacturer’s 2009 bankruptcy case. GM claims that, although the current vehicle recall covers 2004 and 2005 model year cars, the lawsuits are against “new” GM for “old” GM’s mistakes.

However, plaintiffs who have requested a class action lawsuit against the company on Monday, April 21st, sought an order that would force GM into court, stating that the automotive manufacturer cannot use the bankruptcy case from 2009 as a legal shield.

“GM’s argument suggests that the U.S. Government would have agreed to extend $40 billion of taxpayer money for GM’s restructuring, and supported shielding it from liability through the sale order, had it known of GM’s intentional misconduct,” the plaintiffs said in their lawsuit.

Under the company’s bankruptcy terms from 2009, GM reorganized itself into “new” GM. Part of the bankruptcy case included a clause stating that any problems brought on by “old” GM’s management or manufacturing must be filed in court against what remains of “old” GM, even if “new” GM issues a vehicle recall for pre-2009 vehicles.

“New GM’s recall covenant does not create a basis for the plaintiffs to sue new GM for economic damages relating to a vehicle or part sold by old GM,” the company said in a filing on Monday in the Bankruptcy Court for the Southern District of New York.

However, the motion did not address issues brought forward in the massive 2.6 million unit vehicle recall, which started with a few hundred thousand older model cars that had ignition switch problems. The vehicle recall grew more serious in February and March when the public learned that ignition switch problems had, over the last ten years, injured 31 people and killed 13.

The proposed personal injury class action was filed in a federal court in Texas, and claims that GM knew about the problem since 2004. This created “unreasonably dangerous” conditions for drivers. The proposed class action seeks as much as $10 billion for the lost value of the small cars GM has recalled.

“GM has taken responsibility for its actions and will keep doing so,” spokesman Jim Cain said in an emailed statement. The company has stated that it is committed to replacing the faulty ignition switches.

GM has also issued two other large vehicle recalls: one, due to airbag deployment problems, covers 1.2 million 2008-2013 model Buick Enclaves and GMC Acadia SUVs, as well as 2009-2013 Chevrolet Traverse and the 2008-2010 Saturn Outlook; the other covers 1.5 million Chevy Malibus and Malibu Maxx’s from the 2004-2005 model years, plus some 2006, 2008 and 2009 model-year cars, Chevrolet HHR from the 2009-2010 model years (non-turbocharged only), some Cobalts from 2010, some Saturn Auras from 2008-2009, Saturn Ion from the 2004-2007 model years, Pontiac G6 from the 2005 model year, plus some cars from the 2006, 2008 and 2009 model years, and service parts installed into certain vehicles before May 31, 2010, under a previous recall, all due to power steering problems.

The Strom Law Firm Can Help with Defective Products and Vehicle Recall Cases

If you have experienced a problem with a defective product in your automobile, especially if a defective part has led to an auto accident or personal injury, and a proper vehicle recall notice has not been issued, you may be entitled to compensation. The attorneys at the Strom Law Firm can help. We can help you with complicated auto insurance claims, and make sure you receive the compensation you deserve to help you with lost income and medical bills. Our attorneys are licensed to practice in South Carolina, Georgia, and New York. We offer free, confidential consultations to discuss the facts of your case, so contact us today at (803) 252-4800.