Personal Injury

GM’s victim compensation fund praised by some and criticized by others

GM logo GMs victim compensation fund praised by some and criticized by othersThe compensation fund established by General Motors (GM) puts forth a message that victims of ignition switch failures will be fairly and justly compensated. However, some speculate that the fund is a diversion designed to convince victims to waive their right to a day in court against the automaker.

Kenneth Feinberg was recently hired by GM to head the compensation fund and determine who is and isn’t eligible to receive restitution through the program. According to GM Authority, Bloomberg Television interviewed Feinberg on the details of the compensation fund. Feinberg went on to describe the fund as “generous and fair to the victims [of ignition switch failures].”

“GM will pay anyone who proves they were injured in a crash tied to the faulty switches in one of 2.59 million recalled cars, even if they were drunk or texting on their phone at the time of the accident,” Feinberg tells Bloomberg Television.

Although Feinberg and GM remain hopeful about the settlement’s future, others share a more skeptical point of view. CNN Money’s report on the compensation plan describes how many victims killed or injured in recalled GM vehicles will not be granted any amends, as it is only for those involved with the initial delayed recall.

GM Spokesman Dave Roman described the fund as related to a “unique set of mistakes that were made more than an extended period of time.” While GM declined to elaborate further on this statement, CNN Money presumes that this means that millions of vehicles are excluded from the settlement. Some plaintiff attorneys worry GM is “playing favorites” when it comes to which sets of victims will be allowed to retrieve funds.

Jere Beasley, founding shareholder of Beasley Allen responsible for filing multiple personal injury lawsuits against GM related to the defective ignition switch, was initially fairly critical of the proposed compensation plan. He recently took the opportunity to meet with Feinberg to discuss the plan candidly. After the face-to-face meeting, Beasley loosened his stance on the compensation fund. However, he emphasized the importance of retaining the right to trial by jury if the fund is found to be lacking, on a case-by-case basis.

“At the conclusion of the lengthy meeting, we have decided to submit claims, including death claims and those involving personal injury, to the plan. I believe our clients will receive fair treatment from the Claims Administrator,” Mr. Beasley said. “Of course there will be clients of ours who will prefer to keep their claims in the courts. We will continue to file lawsuits, but will give the plan a chance to work. If it doesn’t work for our clients we will have the option of going back to the court system.”

On August 1, the compensation fund will begin taking claims until December 31, 2014. Despite one lawmaker calling for a deadline extension, Feinberg believes that the deadline serves as an incentive that forces “people to gather their documentation and get the claim in.”

Sources:
CNN Money
GM Authority
Beasley Allen