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On Thursday, automotive giant General Motors announced that they have reached a criminal settlement to end the current government investigation of their faulty ignition switches. GM will pay $900 million for the Department of Justice fine incurred.
Additionally, GM has reached a resolution with over half of the death and personal injury lawsuits that are a part of the current multidistrict litigation through the U.S. District Court for the Southern District of New York. General Motors also settled in a shareholder class action lawsuit filed in the U.S. District court in Michigan for two civil lawsuits. The total for these settlements will set GM back another $575 million.
GM’s ignition switch defect caused cars to suddenly turn off when driving, most notably when the car was jostled from uneven road conditions. As well as an engine shutdown, power steering and power brakes were disabled and the airbags became deactivated. This led to numerous car accidents with severe injuries and deaths.
The MDL and shareholder class action settlements resolve about 1,380 death and personal injury lawsuits in total. GM did not release the individual settlement values paid in the various settlements.
The remaining lawsuits in the multidistrict litigation include economic loss claims, 370 injury lawsuits and 84 death lawsuits. Prior to Thursday’s announcement, GM had already agreed to offer ignition switch settlements to 124 families in death lawsuits and another 275 who were injured.
The nearly $1.5 billion GM is faced with in fines and settlements so far for the defect does not include the cost of fixing the 2.6 million vehicles that have been recalled due to the GM ignition switch defect.
Some consumers oppose how the situation was handled under the law. The Justice Department was criticized for not bringing charges against individual GM employees who were believed to have direct responsibility. In general, this criticism has extended to the DOJ in general for going after companies in general rather than prosecuting individuals for their wrongdoing.
When the GM scandal first came to light over a year ago, the company fired 15 employees for failing to resolve the ignition switch problem.
As it stands, there is no law that deals with criminal penalties for auto makers failing to disclose safety problems, so broader laws such as wire fraud and false statements are used.
According to court documents, GM knew of the ignition switch problem a decade ago in 2004 and 2005. Rather than making a simple and inexpensive change in the part at the time, which was estimated to cost approximately a dollar per vehicle, the situation was overlooked.
U.S. Attorney Preet Bharara summarized the situation, “”They let the public down. They didn’t tell the truth in the best way that they should have — to the regulators, to the public — about this serious safety issue that risked life and limb.”
The plaintiffs are represented by Robert C. Hilliard of Hilliard Munoz Gonzales LLP, Steve W. Berman, Sean R. Matt and Andrew M. Volk of Hagens Berman Sobol Shapiro LLP, and Elizabeth J. Cabraser, Steven E. Fineman, Rachel Geman and Annika K. Martin of Lieff Cabraser Heimann & Bernstein LLP.
The GM Ignition Switch Defect MDL 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.
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20 thoughts onGM to Pay $900M DOJ Fine and $57M in Other Ignition Switch Settlements
I owe a 2000 Chevy Tahoe and had ignition issues since I brought it.
saturn ion 2003 bad motors they need to be out law interference, Motors are Stall being made to day in new cars and bad ignition switch
I have a 2007 gtGrand-Am. My car cut off after a truck slammed on the breaks in front of me and I hit my breaks to avoid an accident,to no avail. The car cut off and everything got tight and we hit the car. Befor we spoke to anyone the other party settled with the insurance company and then I ran across this class action suit.i still receive cards asking me to bring my car in for repairs about the ignition.
I have a 2007 Dodge Ram Mega cab that has stopped on the highway in heavy traffic 4 times after I ran across a pot hole in the road. I have almost been in 3 serious accidents that was avoided by defensive drivers, because my steering wheel and engine stopped working. I took my automobile to the dealer and they just said for me to take some of my keys off my key ring.
My mom has a 2000 Chevy Malibu. Only has 60,000 miles on it because it stayed in her garage most of the time due to her age of 91 now. We would borrow it occasionally when our car was getting repairs. Just before this class action lawsuit became public we started having problems with the ignition switch. when we would try to start it it would not do anything. We had to play around with the switch..turning it on and turning if off several times to get it started. Finally she get a recall letter..took it to the dealership..they said they would do the required fix…which was only to replace the key hole with a smaller key hole to prevent anyone from putting a bunch of stuff on it or from putting a heavy key chain on it. Then they told us the ignition was also bad and we had to pay $600.00+ to get a new one. Now my question…WHY IS THIS NOT COVERED BY THE CLASS ACTION SUIT????
WOW..THEY DONE SENT ME 4 LETTERS CONCERNING 2 DEFAULTS ON MY 2006 DATOKA TRUCK.I WENT IN TO THE DEALER AND THEY TOLD ME THAT IT WAS A FIRST COME FIRST SERVE. THEY WERE TO CALL ME WHEN THE PARTS COME IN.I WANT SO MUCH FOR THIS TO BE TRUE.DAMN, I FEEL LIKE I AM AT RISK BIG TIME.THAT IS NO WAY TO BE DRIVING AROUND,THESE DAYS.
Who is the best law firm to get in touch with on this case?
I complained to the govt years ago that the ignition switch on my 2003 malibu is defective (it stated this in the owners manual), by constantly shutting off the ignition (because the ignition switch is connected to the fuel pump and shuts the car off automatically)the car eventually broke the fuel pump. Gm lied and said they would pay for the repair when presented with a bill they refused and the govt ftc refused to do anything. I guess the govt just wants to force corps to pay money to the govt to be used for govt pensions
the govt crooks steal from the gm crooks and the public be dammed. the money is used to pay preets pension