General Motors Seeks More Protection From Lawsuits
To fuel your love of cars,
visit the Autos section.
DETROIT (WWJ/AP) - General Motors Co. has filed suit in a U.S. bankruptcy court asking a judge to protect the auto giant from legal claims for actions that took place before it emerged from bankruptcy in 2009.
The suit was filed Monday evening in the Bankruptcy Court for the Southern District of New York. A hearing has not yet been set.
The filing asserts that the “numerous lawsuits” recently filed throughout the United States dealing with GM’s recall of cars with possible ignition switch problems are “retained liabilities” of the old GM, not the new company.
The lawsuit says the recall involves vehicles “manufactured and sold by Old GM” and asks Judge Robert Gerber to protect the “new GM” from claims.
“This doesn’t mean GM won’t be paying out billions,” said WWJ Auto Beat Reporter Jeff Gilbert, “but the move could give GM protection from lawsuits for crashes that occurred before its 2009 bankruptcy. Those suing have argued that GM shouldn’t get that protection because it covered up the defects.”
GM is also looking into setting up a voluntary compensation fund to pay out claims related to ignition switch issues before and after their bankruptcy filing.
“General Motors does have a legal defense here. However, if plaintiff attorneys can show that GM lied in the bankruptcy court, that could reopen the case and expose GM to liability,” WWJ Legal Analyst Charlie Langton said.
GM has said at least 13 deaths have been linked to the ignition problem.
TM and © Copyright 2014 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2014 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.