(844) 815-9632

bankruptcy court

GM Recall Compensation Fund: 4K Claims, 93 Settlement Offers So Far

GM's ignition-switch recall compensation fund is no longer accepting claims, as the January 31 deadline has passed. But that doesn't mean consumers are without recourse if they (or their loved ones) were injured in a recalled vehicle. As you probably know, GM issued a series of recalls in 2014 after an ignition-switch defect in about 2.6 million vehicles was linked to dozens of injuries and deaths. As federal investigations began, GM set up a victim compensation fund to deal with death and injury claims. In a regulatory filing released Wednesday, GM disclosed details about the fate of many of those claims, The Detroit News reports. Here's what consumers need to know: GM Compensation Fund Claims: By the Numbers GM's victim compensation fund began accepting claims August 1, 2014. According to GM's regulatory filing, during the six-month claims period that ended January 31: A total of 4,180 claims were filed, including more than 1,100 in the final week alone; So far, 482 claims have been rejected, including one that sought compensation for a dog's death; and Reportedly, 455 claims involved a death. Officially, 51 deaths have now been linked to the GM ignition-switch defect. To date, GM has made 93 settlement offers, and none have yet been rejected, according to The Detroit News. It could take another six months to review all of the claims. Is It Too Late to File a Claim? Though GM is standing by its January 31 cutoff date for compensation fund claims, some politicians want the company to extend the deadline. Regardless, anyone injured in a recalled GM vehicle may still be able to pursue legal action; because each case is different, an experienced attorney can review your claim and advise you on the best way to proceed. As for GM car owners who believe they've suffered economic damages (i.e., loss of their vehicle's market value) because of the recalls, a potential legal roadblock related to GM's 2009 bankruptcy reorganization could stand in the way of compensation. (We previously blogged about the "old GM" v. "new GM" issue here.) Despite the potential bankruptcy reorganization issue, more than 100 class-action lawsuits have been filed against GM seeking economic damages. The bankruptcy issue is being heard in a New York courtroom this week, The Detroit News reports. Related Resources: Injured in a recalled GM vehicle? Have an attorney review your claim for free. (Consumer Injury) GM Recall: Do You Need a Lawyer? (FindLaw's Injured) Should You Hire an Injury Lawyer Even If You Plan to Settle? (FindLaw's Injured) GM Ignition Switch Lawsuit: Overview (FindLaw)
continue reading

GM Recall Spurs DOJ, Congressional Probes

The DOJ is investigating General Motors for allegedly failing to address dangerous safety problems for years before issuing a recall. Federal prosecutors have been joined by members of Congress, who are beginning their own investigation and will conduct hearings on GM's culpability in allegedly waiting a decade to recall 1.6 million vehicles, reports The New York Times. With so much federal scrutiny, this may be a rough year for GM. Recall, Defect Investigation It isn't uncommon or unseemly for auto manufacturers to issue recalls when a safety issue or defect is discovered. In fact, auto companies are required to issue a recall for any vehicle or part that fails the minimum performance standards set by the National Highway Traffic Safety Administration, or whenever a safety-related defect is discovered. According to the Times, federal prosecutors are reviewing whether GM failed to disclose defects to federal regulators like NHTSA -- or even intentionally misled them. At the center of this investigation is a safety defect in the ignition switch in more than 1 million GM vehicles from model years 2003 to 2007. This defect, which put more than three-quarters of a million American cars at risk, could cause engines to turn off while vehicles are in motion. The defect has been linked to at least six deaths, and prompted a massive recall by GM. Investigators will attempt to figure out why GM allegedly failed to fix this defect for so long. The company may have known about the problem as early as 2004, reports the Times. Criminal and Civil Charges Ahead You may not think that executives can charged under criminal law for failing to issue a recall, but that's exactly what the top brass at GM could potentially be facing. Under the TREAD Act -- one made famous by the Firestone tire disaster -- any person who intentionally misleads federal regulators with respect to dangerous or deadly car defects can face up to 15 years in prison. Anyone at GM who intentionally misled government officials regarding the ignition switch defect could be facing serious federal prison time. Aside from that possibility, the company could also be held liable for millions in civil damages, if lawsuits are successful. However, anyone wishing to sue GM for defect-related injuries will likely need the charges approved by a bankruptcy court. According to Automotive News, when GM emerged from bankruptcy in 2009, it agreed to leave all pre-2009 defect issues with "Old GM" in a bankruptcy court. Related Resources: Congress, Justice Department open probes in GM recall (Detroit Free Press) 'New' GM Wants Vehicle Liability Claims to Stay with 'Old' GM (FindLaw's Injured) GM Recall Expands to 1.6M Vehicles; 13 Deaths Reported (FindLaw's Common Law) Browse Motor Vehicle Defects Lawyers by Location (FindLaw)
continue reading