Senator Urges Department Of Justice To Create General Motors Recall Victims Fund
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A U.S. Senator has called on the Justice Department to require that General Motors create a compensation fund for victims who were injured or killed in one of the company’s 1.6 million cars that were recalled last month for faulty ignition switches.
According to the Detroit News, Senator Richard Blumenthal inquired Attorney General Eric Holder to get the DoJ to “immediately intervene on behalf of those injured and killed and all who suffered damages as a result of faulty ignition switches”.
General Motors came to an agreement in bankruptcy court restructuring that allows GM to only be liable for vehicles manufactured post-2009, so parties interested in suing GM for incidents which took place before then will have to go after the “Old GM” in bankruptcy court. However, GM is recalling the vehicles, with even CEO Mary Barra promising to restructure its recall and safety practices going forward in a video. But, nobody is going as far to say that GM will be compensating anybody.
“It is true that new GM did not assume liability for claims arising from incidents or accidents occurring prior to July 2009. Our principle throughout this process has been to the put the customer first, and that will continue to guide us,” GM spokesman Greg Martin told DetNews.
Part of Blumenthal’s request involved dismantling this immunity. He asked the DoJ to “oppose any effort by GM to deny responsibility for consumer damages.” This isn’t the first time Blumenthal has opposed the agreement, in 2009, he led seven other state attorneys in fighting against the measure which shielded GM from any actions taken by “Old GM.”
“Without your active involvement, they may have no meaningful remedy,” Blumenthal wrote in the request. “Given the crucial role the United States government played in creation of the current General Motors Corp., I believe the federal government has a moral, if not legal, obligation to take all necessary steps to protect innocent consumers.”
The DoJ is currently performing a criminal investigation to find out whether or not GM committed bankruptcy fraud by not telling consumers about the faulty ignition switch. The National Highway Traffic Safety Administration has also launched its own investigation into the matter to find out why the company delayed the recall when it knew a defect existed for as long as a decade. Meanwhile, GM CEO Mary Barra is scheduled to testify before a House of Representatives subcommittee next week in regards to the matter.
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“so far, GM has claimed to be not liable for actions taken by the company prior to its bankruptcy filing in 2009. ”
Where did you see GM made this claim?
We added a quote from a GM spokesperson for the sake of clarification.
Thanks, sounds much better.
All I have see is that GM could not be held due to the chapter 11 but I do not see them falling totally behind this.
Old GM is bankrupt and that is not going to fix the recalled cars so New GM will for sure be paying for that. Also they will be paying for any deaths but the settlements will be sealed as they are in most cases like this.
This guy generally is a major over reactor in DC as he has done this on many topics.
It would be best to let this play out and just see who pays for what and just what the investigations provide in the end before we go down this path.
An informed decision would be much more useful than just some off the cuff mad rant like this guy.
Blumenthal tends to try to capitalize on the big media cases when they appear.
Anyone in Washington with a half lick of sense will at least wait till the senate and house hearings to make their play.
Legally GM really can not say much on what they can and will do. The legal representation will limit any of this talk for now. In tie they will form a plan on what they will do. In the cases of settlements they will be undisclosed as they are in these types of cases.
Just what we need amidst all else going on with GM lately is another mouthy politician.
I really can’t see this going anywhere because if they forced GM to pay out settlements to victims, that opens the door for people to sue every auto manufacturer every time a part breaks on their vehicle that causes an accident. “Oh, my 7 year old car’s tie-rod broke and I crashed…… I want money!!!”
Toyota better hope this doesn’t go through or everyone of their 89 customers killed in their acceleration recall issue will be lawyering up too. As will anyone who had a Ford fire (Crown Vic, Escape, etc).
The Senate better thing carefully about how they tread on this water as is could basically force manufacturers to have liability waivers that would have to be signed every time a customer buys a car at a dealership.
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