GM Agrees to $120M Faulty Ignition Class Action Settlement

GM has asked a New York federal judge to sign off on a class action settlement worth $120 million to resolve claims that certain vehicles depreciated in value due to faulty ignitions.

The settlement would put an end to six years of litigation that saw numerous class action lawsuits being consolidated into one multidistrict litigation.

In addition, the settlement calls for $34.5 million to be paid to Class Members’ attorneys, according to the papers filed in federal court.

Two lawsuits were filed in October 2014 by vehicle owners who claim that, after GM had issued a recall of the faulty ignition switches, the values of their cars decreased. Before the recall was issued, there were 24 deaths due to the ignition switch defect. GM issued a recall of 27 million vehicles in 2014.

The terms of the settlement state that GM will put $70 million into a common fund for vehicle owners and that $50 million will come from a trust, which is connected with the company’s 2009 bankruptcy.

Numerous allegations were brought against GM, specifically by a private investigator who discovered that some individuals in the company knew about the ignition switch problems 10 years before the company recalled the vehicles.

In addition, an investigation by the National Highway Traffic Safety Administration (NHTSA) found that GM tried to “hide the ball” from investigators and actively discouraged their employees from revealing information about the defect to the public. The NHTSA fined GM $35 million for not coming forward with the ignition defect.

In 2015, the U.S. Justice Department filed criminal charges against GM for concealing the ignition switch defect from the NHTSA during the Spring of 2012 through February 2014. In addition, the criminal charges against the company stated that the company misled consumers concerning the safety of some GM cars.

The Justice Department said that the defect came from an ignition switch with “too-low torque resistance and could therefore move easily out of the “Run” position into “Accessory” or.” When the switch was moved out of “Run,” the frontal airbags could become disabled, which could increase the risk of death or serious injury in crashes where the airbags would deploy.

The model of cars included in the settlement are the 2005 – 2007 Chevrolet Cobalt; 2005- 2007 Pontiac G5; 2003 – 2007 Saturn Ion; 2006 – 2007 Chevrolet HHR; 2007 Saturn Sky; 2006 – 2007 Pontiac Solstice; 2004- 2006 Cadillac SRX; 2004-2007 Cadillac CTS-V; 2010-2013 Buick Enclave; 2009-2013 Chevrolet Traverse; 2008-2013 GMC Acadia, 2008-2010 Saturn Outlook vehicles; and others.

In 2016, the plaintiffs in the GM class action lawsuit told a judge that a Second Circuit’s bankruptcy ruling related to the defect meant that GM should be held liable in the loss of value cases. GM had asked the Second Circuit to enforce a “free and clear” sale order and bar claims against it that were based on the ignition defect.

The Second Circuit stated that by not revealing the ignition defect, the defendant took away the rights of victims because they never had a chance to contest the bankruptcy.

Also, in February 2016, GM filed a motion to dismiss the plaintiffs’ claims, arguing that the claims were based on the stigma of the recall announcement.

Numerous other lawsuits have been subsequently filed against GM related to the ignition switch issue.

For example, in 2018 a lawsuit was filed by a Tennessee woman who claimed that the ignition defects caused her to sustain injuries when she was in a car accident.

The ignition switch failure reportedly caused the plaintiff to get into a car accident on April 14, 2011. She sustained many serious injuries, including a fractured spine.

The plaintiff filed legal action against GM after finding out that the company knew the cars suffered from an ignition defect, which caused the airbags to deploy.

She also maintains that the ignition switch in her 2005 Cadillac CTS failed and the fact that her airbags did not deploy during the accident could have caused her to sustain more injuries.

In addition, the plaintiff in this class action lawsuit claims that the ignition switch could not withstand movement from key chains and could be moved even with a slight tap of the knee. She maintains that the ignition switch was suddenly turned off while driving, which also switched off other safety features in her car, including the airbags.

Did you own a car with an ignition defect? Leave a message in the comments section below.

Top Class Actions will post updates to this class action settlement as they become available. For the latest updates, keep checking TopClassActions.com or sign up for our free newsletter. You can also receive notifications when this article is updated by using your free Top Class Actions account and clicking the “Follow Article” button at the top of the post.

The plaintiffs are represented by Hilliard Munoz Gonzales LLP, Hagens Berman Sobol Shapiro LLP and Lieff Cabraser Heimann & Bernstein LLP.

The GM Ignition Defect Class Action Lawsuit is In re: General Motors LLC Ignition Switch Litigation, Case No. 1:14-md-02543, in the U.S. District Court for the Southern District of New York.

UPDATE: July 2020, the GM ignition switch defect class action settlement is now open. Click here to file a claim.

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