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GM Is Not Happy With Latest Billion-Dollar Ignition Switch Settlement

While current General Motors ignition switch drama has come to an end, lawsuits surrounding “Old GM” continue to drag on. Following a federal judge’s ruling, lawsuits directed towards Old GM were allowed to proceed. A previous ruling stated GM’s old entity could not be held responsible.

Those lawsuits reached a billion-dollar deal over the weekend, and GM isn’t pleased with the results. The deal will require the automaker to turn over $1 billion in stock, which would resolve 11.9 million economic loss claims and between 400 and 500 personal injury and wrongful death claims, according to Reuters.

GM lawyer Richard Godfrey condemned the deal and said New GM was not involved in the negotiation process and that this settlement was solely worked out between plaintiffs and creditors of Old GM. He called the deal “a complete surrender and sellout using New GM’s money.”

The plaintiffs’ lawyer, Steve Berman, rejected GM’s conclusion. “The notion from new GM that this is somehow an inappropriate procedure is crazy,” he said. “They bargained for this.”

Godfrey insisted the Old GM trust held $400 million that could be used to pay out in a deal instead of New GM being forced to turn over current stock. Berman plans to trigger a provision in the automaker’s bankruptcy reorganization plan that will transfer the $1 billion in stock to the trust in order to fund the settlement.

Former GM Authority staff writer.

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Comments

  1. Must be an activist judge.

    In a case like this all parties should be represented and given a chance to prove their case be it GM, the families and the creditors.

    Just creditors and lawyers picking low hanging fruit.

    Reply
  2. OLD vs NEW, a nifty thing to hide behind. Garbage Motors also does that when they refuse to fix the horrendous rear suspension design of the later 2000 era Impala that causes premature tire wear. Too bad people can’t do this, “you can’t hold me responsible for my crime, that was the OLD me.”

    Also be careful when saying “GM’s money” when much of it never was repaid to the lender. Most taxpayers, aside from the 6 people who frequent this site, aren’t that bad at math.

    Reply
    1. You do realize the goverment took a percentage of the stock in place of payment. Then the Obama admin sold the stock.

      GM has no obligation based on the deal they were given and the goverment selling off the stock.

      We are damn good at math and the detail facts you tend to either miss or leave out.

      Reply
      1. When Dick Cheney was V.P. there was only one good thing about him: everything he said was a lie. That’s a good thing because if you need to know what the truth was in any given situation you’d simply wait for Cheney to snarl out some nonsense and then know what he just said is the opposite of this truth.

        Thanks for being the Dick Cheney here. You’re a wealth of information.

        Reply
  3. General Motors will need to take the fight to the US Supreme Court and hope that the more Conservative majority will decide in their favor.

    Reply
    1. Things seem pretty unpredictable in our nation’s capitol lately…

      Reply
  4. These people should not get one red dime!!!

    Reply
    1. are you kidding!!!

      Companies must be held responsible for their actions but this amount is excessive.

      GM hasnt changed enough. The work and production culture is still to produce subpar quality products and the proof is in the amount of TSBSs released on every product they sell.

      The only thing GM is good for is to keep the aftermarket parts business strong and healthy…

      Reply
  5. If the last long enough to make it threw the warranty then that part is not defective!

    Most if not all of the cobalts were way beyond the cars manufacturers warranty. So the part worked, it didn’t fail until out of warranty, so this means it should be the responsibility of the owner and not the company!

    Like I said not one red dime

    Reply
    1. Many didn’t make it through the warranty those cases haven’t been heard yet since most died or seriously hurt to the point of being comatosed…GM=cherrypick cases in favor to leave the ones really hurt due to negligence waiting for the inevitable loss to show guilt and lose money in stocks

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    2. This attitude is what helped GM lose its market share to foreign companies and helped it go bankrupt, I really hope the new GM doesnt think that way

      Reply
  6. G.M Covered this up for years….ignored this for years….LIED about this for years. Bottom line They should pay

    Reply
    1. Not one dime! These drivers shouldn’t get nothing!

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  7. Hey Brian my crash happened while serving in the Marines it got me back and forth to Home and my duty station. One year old car well within its warranty in 2008 they told my family it’s a fluke we have no idea why the airbag didn’t deploy while I was in a month long coma. Their animals that need to see the light of day behind bars. I’m a pre bankruptcy case so they are shielded from bankruptcy why I was told I couldn’t sue. GM is cherry picking the obvious ones in their favor so people get sick of hearing Ignition Switch.But they’re are many not in their favor they will be coming this year. Please keep your hateful remarks to yourself I also served in war after my month long coma from my cobalt they Military was happy to heal me up just to ship me overseas I don’t want their money I just want to see the ones whole switch the part with a cheaper one in jail it’s no different if it was a plane and a mechanic used a not conformed part which In turn caused a crash he would be stripped of an A&P and fined or jail. None of that occurred why is that?

    Reply
    1. I could care less! Maybe had you controlled your car better you wouldn’t of gotten into a accident and therefore a coma!

      And yes I would say the same thing to my loved ones!

      Reply
  8. Brian doesn’t care why he never served in a war!!! Controlling my car has nothing to do with the TBI coma that came from the airbag not deploying and GM saying it should have gone off this was unknown. So they also lied under oath since this was a lawsuit before the bankruptcy. Brian what do you do for a living, why are you really biased? Yeha your loves one would be proud you would call them idiots for not driving a car well they don’t make without those features lost because of the switch…

    Reply
  9. You don’t know a dam thing about me! I just happen to be a VET! Yep just like you! And no I don’t work for GM or any of its suppliers!

    I just have this ability to see threw the BS that people either don’t want to see or don’t have the backbone to point out!

    Reply
  10. GM deliberately produced cars that were defective to ensure a future market for future production. The company went bankrupt and many customers, supplies and investors supporting the company lost a lot. This is a fact.

    The law suits should serve as a reminder to existing management and staff of the new GM that they cant return to the way they used to do business. They should produce a quality product that isnt a defective one coming off the assembly plant line.

    I know some would argue that this isnt the same GM and they are doing better but I for one would welcome these law suits to ensure that GM will continue to change for the better and yes that would mean some of the Lawsuits might become ridiculous but as I have mentioned that is required to ensure that GM would continue to improve their product line.

    MY cousin worked for the old GM many many years as a quality improvement engineer, From what little information he shared with us, I can tell you that GM did know of all the defects and had the ability to eliminate if not reduce the occurrence at no extra cost but chose to do nothing and in the process some consumers did get hurt. GM management and staff new about that but deliberately chose not to do anything to maintain future product demand and market. They bet that consumers would return every 3-4 years to buy a new car from them but that didn’t happen. They lost their market share to all the foreign producers and then eventually went bankrupt.

    The problem is, how do you ensure that the company culture hasn’t changed to the better? How do you ensure that the old culture never returns to the new GM? I say through similar lawsuits which is why I invite all the lawyers around the world to investigate every ridiculous claim and continue the pressure on GM to give us a quality product for many years to come..

    Yes that would mean that we will pay a little more for the product because GM is paying off settlements but that is our insurance policy that the product is better than average and it is the best that the company can produce because it fears a lawsuits and costumer backlash.

    Reply
    1. BTW the last fiasco at VW and Audi saw the company staff and management lose their jobs income and more but it also ensured that the product has improved,

      Lawsuits are the only way to ensure large organisations improve and become more responsible to their consumers.

      Reply
      1. Exactly why I was at a Washington DC caucus at the Supreme Court spoke on CNN trying to change the law in the auto industry to have better policies on recall and defect protocols at the manufacturer level. Well put Mohannad…

        Reply

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