Product Liability

Ignition switch victims to challenge GM bankruptcy ruling

GM recall Ignition switch victims to challenge GM bankruptcy rulingSeveral plaintiffs barred from suing General Motors by a bankruptcy judge’s ruling have taken the first steps to appeal the decision, which shields the automaker from complaints involving ignition switch malfunctions any time before June 1, 2009 – the day the “old GM” reorganized to become the “new GM.”

According to Bloomberg, a group of plaintiffs harmed in accidents allegedly caused by GM’s dangerous ignition switch flaw filed a notice of appeal Wednesday to a federal court in Manhattan.  The victims seek to overturn an April 15 ruling by bankruptcy judge Robert Gerber, which jettisons GM’s liabilities prior to the day it filed for bankruptcy protection, allowing the “new GM” to move forward unfettered by past wrongdoing.

Plaintiffs in three economic-loss cases who claim GM’s ignition switch controversy diminished the value of their vehicles have also filed notices of appeal to the same court.

GM’s faulty ignition switches affect about 27 million vehicles made over a decade’s time. The problem can allow keys to jostle the switch to the “off” or “accessory” mode, resulting in a sudden loss of power steering, anti-lock brakes, and airbag protection while the vehicle is in motion. The defective ignition switches have been linked to 111 deaths as of June 8.

Of the 220 injury claims submitted to GM’s ignition switch victims compensation fund approved so far, 13 are for serious or catastrophic injuries and 207 are for minor injuries that required hospitalization or outpatient medical treatment.

Victims of ignition-switch related crashes can opt out of seeking compensation from the ignition switch fund and sue GM for damages in court.

Source: Bloomberg