When General Motors emerged from bankruptcy, the automaker reemerged as the “New GM.” Now the New GM is seeking immunity from accident and economic-loss claims related to products made under “Old GM.” The automaker will ask U.S. Bankruptcy Judge Robert Gerber to dismiss these claims sometime before August 11.
Of course, the company has made one big exception to this: the much-publicized ignition switch defect in small cars built by the Old GM. CEO Mary Barra has made it clear that New GM will honor Old GM’s liability in this instance, warning “that she will fight all claims except for those arising from switch-based accidents,” writes Automotive News. According to GM, the company is currently fighting over 100 lawsuits unrelated to faulty ignition switches in cars built by Old GM.
General Motors was encouraged by the Treasury to “slough off as many liabilities as possible to aid a turnaround” back when the company came out of bankruptcy in 2009. While defective cars made under New GM are the responsibility of the manufacturer, Gerber ruled at the time that “[The New] GM didn’t have to pay compensation or punitive damages for [Old GM’s] faults.”
As AN notes, General Motors’ request will significantly expand Gerber’s role in the litigation as he will be forced “to ordain the future of almost all suits tied to Old GM cars.” Whatever is ruled, it will have no affect on the ignition-switch-related claims that GM will begin accepting on August 1.
Comments
Yes – we all know this is a GM fan site. But the fact there are ZERO comments on this story and probably
15-20 on some story about a 1000hp Corvette seen on eBay, is proof there is a great disconnect when
matters that matter come up for review.
Why don’t I just screw over tens of thousands of people – kill some, and maim some…Then go through
a government ( us tax payers ) bailout ( rehab ) and refuse culpability because that “WAS THE OLD ME!”…
“OLD GM” sure acts a whole lot like the “NEW GM” – lots and lots of times. Today they continue to build
gas-sucking dinosaurs and bigger-than-ever SUVS for bigger-than-ever profits….And 1/5th of the stories
on this site nowadays refer to damage-control and paying off what little lawsuits they can get away with!
Just what if that was you or me? I’ve been screwed over by Toyota before, and when you are in that
position – it feels as if legions of attorneys are stacked against you. State lemon laws and class-action
are your only friend – and those oft go awry to the side of the mega-corporation. I see this as GM
trying to slink out of their responsibilities and you should also.
Shameful, GM. Absolutely shameful.
James the truth is people have seen through this deal and the media and just don’t care.
We here for the most part outside of about 5 people that chime in just to troll know the truth and just what happened and why.
GM is not screwing anyone as any deaths even the drunk unbelted speeding drivers will get their money.
GM is doing what was determined legal by a court and it will protect them from people with Worn out Cobalts with 250,000 miles claiming they lost $5,000 resale value.
Anyone who thinks a Class Action case is their friend is very naïve. All a class action does is cost a company millions they add to the price of the next car sale and enrich the lawyers. Often the person being defended gets a discount on their next oil change if they are lucky while the lawyers drive off with millions in their pocket.
The fact is those who think the big Corp is screwing them are often screwed by the legal system and they never even get a kiss.
I strongly disagree with your summations, Scott. I do agree that nobody on here cares much about the
deaths and the corporate dodging. My brother purchased a brand-new Silverado in the 1990s only to
experience a delay with a significant “clunk” when he shifted the auto trans. Several trips to the dealer,
and rental cars – and still got the “I don’t hear anything!” response from the service dept. Later, I’d ask
other Chevy truck owners “have you experienced this?”, and not surprisingly every one to the letter
said they’d had. In a few months, 20/20, an ABC documentary/expose show revealed a memo that
was sent in by a whistleblower that was sent from GM-Detroit to all Chevrolet dealers about that very
same truck matter. It read: “We acknowledge the U-joint problem but the cost to repair each truck
would run into the $1,000,000s – Tell the customer nothing is wrong and we will fix it in the next
iteration of our trucks”. !!!! . In the end, GM paid out many more millions when the fraud was exposed.
My brother’s truck was repaired, but his trust in GM was destroyed forever. Today, he owns a RAM
1500.
Toyota was smack in the middle of their unintended-acceleration media/Congress debacle when the
HID headlights of their Prius models began going out right at warranty’s end. The result was a huge
repair bill for Prius owners wherein the entire front clip of the car needed to be removed – ballasts
and boxes for the headlights changed along with replacement bulbs. This flew under the media radar
yet message boards and consumer advocate websites buzzed with tens of thousands of reports. At
$1500 per headlight – Prius owner’s gasoline savings went out the window! So what happened? Two
class-action lawsuits – the kind you say do nothing. Toyota first responded with letters meant for fools.
One sent out said not to “cycle” the HIDs as they were “heat-sensitive”! Ha! Imagine being told to
leave your lights on when you go into that store! Toyota then said they would reimburse folks who
paid the dealer $900 for headlight ballasts as they were not at fault, just the bulbs. Still, as a Prius
owner myself, I had the headlight thing hanging over my head. Finally, Toyota settled. They added
an extension to Prius warrantees for the headlight bulbs. I waited patiently for mine to pop, which
they did, and yet I was stressed due to perhaps having to lie to my service dept. to get them replaced
as we babied those headlights and at 35,000 miles they both still worked fine. In the end, Toyota
paid for my headlights, and I saw how public pressure indeed saves consumers from being ripped off.
Not saying much for Toyota, as my ( honest! ) service manager told me 3rd gen Prius had the same
issue! – HERE WE GO AGAIN, DEPT.!
The thrust of “NEW GM” hiding under legal loopholes from “OLD GM” liabilities to consumers shows
they still are in large part – still “THE SAME OLD GM”. Wouldn’t it be nice if manufacturers just acted
like Tesla? When anything becomes apparently wrong with a Model S, Tesla quickly comes up with
a fix, calls in the cars and fixes it no-charge! WOW!
Oh I agree GM has many sins in the 70’s-2008. There is no doubt about that. But the truth is all automakers have sins out there just the same.
Also a major player here was also the poor dealer ships that even the automakers have a hard time controlling. Often the trouble people had were a bad dealer and for some dumb reason they keep going to the same one.
The fact is nearly all here are tired of the trumped up ignition issue many here did the home work and understand all aspect of it not just what the media wants to tell.
The fact is man in the media are anti capitalistic and they will attack any MFG that has a weakness. It is not fair and their motives are not always genuine but in a round about way it makes the MFG better.
The fact is most MFG are at a disadvantage when it comes to claims. Even if they are 100% right they lose if they fight it in court as it will cost them 10s of millions of dollars to win. Most settle even if they are not at fault because it is cheaper. The legal blackmail of our legal system is a joke.
In most countries the looser pays and people just do not file a case just to see if they can get a settlement.
In the latest case the folks who were drunk and unbelted are getting settlements even though their demise was due to their own negligence. If they had been belted and not speeding or drunk they would still be here and in many cases just bruised up.
I am in favor of personal and corporate responsibility. It is time we stop rewarding bad behavior.
I think GM here should pay for what they did do but I also feel those who did not make use of the safety equipment and followed the law should also be held for their actions. Fair is fair.
Time we stop pushing the responsibility on others. Until there is tort reform there is little protection for the MFG and in the end we all pay for it as they pass the cost on to us.
No MFG pays for the class action it is the consumer.
There are legitimate cases out there and then there are cases that are over blown. Also going back 20 years with expectations of present day don’t wash either. Time change as do standards and you can measure the past with the present many times. If that were the case ten ever car prior to seat belts is a litigation case just pending.
As for Tesla get real. Look at how many cars they make 1 and how many they make a year what is it now about 30K?
Any company with a low volume car and only one model can do things like this. Things will change if they ever expand as they hope to. But even their expansion will be a real test as they will have to build plants and invest unlike they have already as much of what they use now was cheap or free at the Fremont plant.
Comparing Tesla to a GM, Toyota or VW is just silly. These companies deal in product number to the 32 exponent or more vs. Tesla’s full output.
If you want to use an example use one that produces car in a similar volume to be accurate.
If all GM built was Corvettes then we would be having a equal comparison.