By Amanda Antell  |  July 2, 2014

Category: Consumer News

GM ignition switch recall class action lawsuitGeneral Motors (GM) was hit with a massive $10 billion GM class action lawsuit this week over its ignition switch recall. The GM class action lawsuit alleges that the company’s actions hurt the resale values for millions of vehicles, inconveniencing many of the owners of GM vehicles.

The lead plaintiff is Anna Andrews, who filed the GM ignition switch recall class action lawsuit in a California federal court on June 18. Unlike most economic loss recovery lawsuits, Andrews is attempting to claim damages associated with vehicles that were not recalled this year. Her GM lawsuit is for the diminished value of her car, based on the fact that the recall negatively impacted the value of her vehicle due to GM’s increasingly bad reputation.

This GM lawsuit requests that the auto company be required to compensate 15 million car and truck owners for diminished resale value, even though none of the vehicles were part of the millions of cars recalled this year. Potential Class Members include those who suffered from the company’s loss of public grace, which has been worsening over the past several months.

Not only did the company admit to the ignition switch defect, but it was also revealed that GM knew about the defect ahead of time, but failed to take corrective action.

In addition to the public’s criticism, GM is under investigation for criminal charges and was fined $35 million by the National Highway Traffic Safety Administration (NHTSA).

GM has increased internal scrutiny and has recalled more than 20 million vehicles for a variety of different safety issues since February 2014. Internal investigations have already revealed that a “pattern of incompetence” existed in the company over the past decade.

The GM class action lawsuit alleges that GM’s alleged inaction caused the owners of vehicles not affected by the ignition switch defect losses of $500 to $2,600 in value of their cars.

According to the GM lawsuit, Andrews owns a Buick LaCrosse, and she claims that if she had known about the possibility of an ignition design defect in GM vehicles, she never would have bought the car. It remains unclear if Andrews’ vehicle actually has the ignition problem itself.

In the rise of the ignition switch controversy, GM is facing a growing number of personal injury and wrongful death GM ignition switch defect lawsuits brought by people who were injured or who lost loved ones when air bags failed to deploy during accidents due to the ignition defect. GM is also facing economic loss lawsuits filed by investors and vehicle owners, who state the company’s actions led to a depreciation of the value of other GM cars, as well as the company’s stocks.

The company’s executives have promised to compensate all personal injury victims and families in wrongful death cases, but said it will fight against economic damages claims.

Overview of the GM Ignition Switch Recall

GM has apologized for the delay in recalling defective vehicles, and admits that the pre-examination of the cars was not completed as it should have been, causing the company to miss the design defect. The company has also stated that it is looking for ways to further improve vehicle safety and implement better manufacturing procedures. The ignition switch defect caused so much controversy because it allegedly caused the vehicles to turn off when they should not have, leading to car accidents. The defect also caused the airbags to fail in the case of an accident.

According to an independent review by The Center for Auto Safety, the ignition defect has been linked to as many as 300 deaths. The recalled GM vehicles affected by the ignition switch defect include:

  • 2005-2007 Chevrolet Cobalt
  • 2005-2007 Pontiac G5
  • 2003-2007 Saturn Ion
  • 2006-2007 Chevrolet HHR
  • 2005-2006 Pontiac Pursuit
  • 2006-2007 Pontiac Solstice
  • 2007 Saturn Sky

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

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