GM CEO Mary Barra told a Senate subcommittee the company isn't sure if it will set up a fund for the victims of the company's faulty ignition switches.
General Motors is moving to limit its potential legal fallout created by faulty ignition switches that have been blamed for 13 deaths.
GM’s lawyers have asked federal judges in jurisdictions around the U.S. to shield the company from any legal claims for conduct that occurred before its 2009 bankruptcy. The ignition-switch problems germinated during the nine years before GM filed for bankruptcy in mid-2009 and GM has asked federal courts from California to Texas to block new lawsuits.
As part of the strategy, GM said it also intends to file a motion in federal bankruptcy judge in New York, seeking a court order stopping plaintiffs from suing the company over the ignition switch recall, according to court documents.
GM said, in its filings, it is facing at least 36 ignition switch lawsuits and more are expected in the wake of the widespread publicity about the ignition switch defects. GM CEO Mary Barra has promised the company will repair all 2.6 million defective vehicles.
Among the cases the company wants stopped is one filed in a California federal court by 13 owners and leasers of recalled GM cars. The plaintiffs, who are seeking to broaden their case into a class action suit, seek compensation from the company for selling or leasing them cars that were “prone to fail.”
The motion GM filed in a federal court case in Corpus Christi, Texas, asked U.S. District Judge Nelva Gonzales Ramos to delay action on the lawsuit until the bankruptcy court rules and other federal courts decide if the case should be combined with other lawsuits. However, GM said it’s not asking to halt action on a motion to force the automaker to tell customers not to drive their cars that are being recalled.
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GM has said at least 13 deaths have been linked to the switch problem. The switch can unexpectedly slip out of the “run” position, shutting down the engine, knocking out power-assisted steering and power brakes, and disabling the air bags.
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“Just like the other ‘ignition switch actions’ that other plaintiffs have filed in the wake of public reports regarding the outstanding recall, this case relates to a vehicle designed, manufactured, originally sold and advertised by Old GM,” the company’s motion says.
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GM is trying to limit its legal liability in the cases while it considers compensation for families of crash victims. GM has hired Kenneth Feinberg – who handled the fund for the victims of 9/11, the Boston Marathon bombing and the BP oil spill – to explore ways to compensate victims. No decision has been made.