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Bankruptcy Ruling Blocks GM Ignition Switch Recall Lawsuits
A bankruptcy court order five years ago bars plaintiffs' attorneys from suing General Motors Co. over its recall of 1.6 million cars to fix an ignition switch defect the company knew about 13 years ago, Bloomberg News reports.
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A bankruptcy court order five years ago bars plaintiffs' attorneys from suing General Motors Co. over its recall of 1.6 million cars to fix an ignition switch defect the company knew about 13 years ago, Bloomberg News reports.
The order was issued as part of the court's approval of GM's restructuring. The rule shields the new company from any product-related liabilities that occurred before the post-bankruptcy GM was born on July 10, 2009.
Bloomberg says liability lawyers could attempt to overturn the court order. But it says doing so would require them to prove that pre-bankruptcy GM knowingly deceived the judge about the ignition switch defect.
GM has hinted that it might compensate more victims than it may be found legally responsible for. Clarence Ditlow, executive director of the Center for Auto Safety, suggests the carmaker set up a goodwill fund for future claims of personal injuries, property damage or wrongful deaths that occurred before July 2009.
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