Missy Clyne Diaz  |  October 24, 2014

Category: Consumer News

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GM ignition switch recall class action lawsuit

Two General Motors class action lawsuits have been filed on behalf of 30 million GM consumers accusing the automaker of lying about the safety of its vehicles both before and after GM filed for Chapter 11 bankruptcy.

The consolidated GM recall lawsuits allege that more than 60 recalls affecting more than 27 million GM cars and trucks sold in the United States for model years 1997 to 2014 have caused consumers to lose value in their vehicles.

The two consolidated GM class action lawsuits were filed on Oct. 14 in the U.S. District Court for the Southern District of New York, the same place where hundreds of class action lawsuits against GM have already been consolidated.

The first consolidated class action lawsuit covers all GM vehicles sold after the company’s bankruptcy proceedings and accuses the automaker of misrepresentation, concealment and non-disclosure of a numerous serious safety defects.

The second consolidated GM class action lawsuit seeks compensation for millions of GM vehicle owners “with serious ignition-related safety defects that can cause the vehicle’s ignition switch to inadvertently move from the ‘run’ position to the ‘accessory’ or ‘off’ position during ordinary driving conditions, resulting in a loss of power, vehicle speed control and braking, as well as a failure of the vehicle’s airbags to deploy.”

Both GM lawsuits seek compensation under the U.S. Magnuson-Moss Warranty Act and allege fraudulent concealment, unjust enrichment and breach of implied warranty of merchantability under Michigan law and dozens of state consumer and fraud statutes. They seek to represent a nationwide Class and subclasses in all 50 states against GM as the sole defendant.

If the GM lawsuits are certified as class action lawsuits, GM’s liability could top $10 billion. The 68 plaintiffs include consumers from 40 states and Washington D.C., as well as two used-car dealers, according to Car and Driver.

Beginning in February 2014 and continuing to today, GM vehicles have plummeted in value, the GM lawsuits allege. Specifically, 2010 and 2011 Chevy Camaros have declined $2,000 in value while the 2009 Pontiac Solstice has lost $2,900, according to the complaints.

“You see an initial diminution in value after the February recalls that pretty much affect just the ignition-switch cars; and then by March, and particularly by June, we begin to see all GM vehicles are taking a hit, and the hit has been getting worse over time,” said Steve Berman, Hagens Berman’s managing partner. “By September, the diminution of value has been increasing.”

In general, GM ignition switch lawsuits are filed individually by each plaintiff and are not class actions.

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