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.