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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)
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1st GM Ignition-Switch Defect Lawsuit Filed

GM is facing a potential class action lawsuit over an ignition switch defect linked to the recall of more than 1.6 million compact cars. The lawsuit was filed in Texas federal court on Friday, alleging that General Motors knew about the dangerous defect in 2004 but failed to fix it -- putting drivers' lives at risk and reducing the resale value of their vehicles, reports Reuters. What does this suit mean for GM? Federal Suit May Become Class Action Daryl and Maria Brandt filed the lawsuit because of safety risks posed by their 2007 Chevy Cobalt, one of the many models recalled by GM over the ignition switch defect. According to Reuters, the couple claims they "have driven their car less than otherwise" fearing an accident caused by the ignition switch issue. The Brandts do not claim that they were injured in an ignition switch-related accident, but they do want compensation for diminished resale value and the loss of use of their vehicle. Their suit is seeking class action certification, so that the Brandts can represent similarly situated individuals across the country who may have been injured by GM's alleged wrongdoing. In order to be certified as a class action, a federal court must find that: It is impractical for each plaintiff to sue on his or her own, There is a common complaint shared between class members, Class representatives (in this case, the Brandts) have the same claims and defenses as others in the class, and The lawyers and representatives will fairly represent the class. Payouts in class action lawsuits can be substantial. You'll recall a class action suit related to Toyota's sudden acceleration issue settled for more than $1 billion. Legal Troubles Mounting for GM This potential class action suit is yet another legal action on GM's plate over this ignition switch defect. Both Congress and the Justice Department are looking into criminal and civil charges against the car manufacturer for allegedly misleading government regulators by not giving notice of the defect. GM car owners will want to check to see if their vehicle is included in the ignition switch recall, and will also want to consider contacting an experienced motor vehicle defect lawyer if they feel they've been injured by their defective vehicles. Related Resources: Lawsuit Filed Against General Motors Over Ignition-Switch Recall Losses (Insurance Journal) GM Recalls 780K Cars After 6 Deaths (FindLaw's Injured) GM Recall Expands to 1.6M Vehicles; 13 Deaths Reported (FindLaw's Common Law) GM Recalling 1.5M Vehicles Over Fire Risk (FindLaw's Injured)
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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)
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GM Recalls 780K Cars After 6 Deaths

General Motors is recalling more than three-quarters of a million cars because of safety issues linked to six front-seat fatalities. But GM also blamed some of the deaths in part on drivers themselves. GM announced that the 778,562 affected cars are at risk for the ignition switching out of the "run" position, turning off the engine "and most of the car's electrical components," Reuters reports. How do these GM cars suddenly shut off, and which GM vehicles are affected? Ignition Issue Identified The affected cars in the GM recall are at a much higher risk for the ignition switch to move out of the "run" position, shutting off the engine and the car's critical electrical components while the car is in motion. Airbags failed to deploy in some cases, a GM spokesman said. According to Reuters, GM pointed to "weight on the key ring" or "road conditions" as possible factors leading to the ignition switch's failure. But a GM spokesman also told Reuters that drivers' alcohol use and failure to wear seat belts were also factors in some of the six fatalities. As the National Highway Transportation Safety Administration begins its own investigation, relatives of those killed in the recall-related crashes could potentially sue GM for wrongful death, claiming that the company violated its duty in releasing a defective and dangerous product. Prior deaths due to defective cars have resulted in multimillion-dollar awards for relatives of those killed by the defect and/or a company's negligence. Is Your GM Vehicle Affected? Although Reuters reports that GM has laid blame for the ignition switch failure on parts make in Mexico, drivers of affected cars are still entitled to a free repair and replacement of the defective parts. The recall only involves the 2005 to 2007 Chevrolet Cobalt and 2007 Pontiac G5, models which GM no longer makes. A GM spokesman explained that fewer than 80 percent of the recalled vehicles are in the United States. The remainder are in Canada and Mexico. Affected vehicle owners should be receiving a letter from GM notifying them if their cars are part of this large recall. GM owners can also visit GM's website and enter their cars' Vehicle Identification Numbers to verify if the vehicles are under recall. Related Resources: 6 killed in GM cars with faulty ignition switches (USA Today) GM Recall Announced on Hummer and Corvette Vehicles (FindLaw's Common Law) GM Class Action Suit: GM Only Fixed Police Cars (FindLaw's Injured) GM Recall on 243,000 SUVs and Crossovers for SeatBelt Problems (FindLaw's Common Law)
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