The U.S. Treasury is trying to keep confidential information from the General Motors bailout confidential, suggesting that companies seeking help from the government in the future may be less willing to disclose important information.
At issue is a $10 billion lawsuit against GM for damages by vehicle owners who claim their vehicles lost value due to the ignition switch recall. A parallel suit by owners of vehicles sold by the “Old GM” might have to be redrawn if the bankruptcy judge renews his 2009 orders that freed new GM from the liabilities of its predecessor.
The lawsuit has been brought on by the Washington-based Center for Auto Safety, which sued the government back in 2011 for information before the government invested in $49.5 billion in General Motors. The Center received more than 50,000 documents but desires more records on the government’s role in a ban on lawsuits over older GM cars. The Treasury, in turn, is asking a judge to throw out the lawsuit.
The president of the Center for Auto Safety, Clarence Ditlow, said GM came to the government and was forced to produce the information as a condition of getting money; it is this information that he is now seeking.
“Disclosure of information will not deter corporations begging for billions in taxpayer dollars from seeking bailout funds in the future,” he told Bloomberg via email.
However, the government feels differently: “Disclosure of the disputed information would also impair Treasury’s ability to obtain necessary information from companies in the future. [The] Treasury’s ability to act as a lender would be hampered.”