A replacement for the faulty GM ignition switches.
Owners of General Motors vehicles with faulty ignition switches seeking compensation for the drop in value of those vehicles lost an important court battle after the judge in the case denied their request for monetary damages.
U.S. District Judge Jesse Furman handed down his ruling Tuesday, saying that owners in three bellwether states – California, Missouri and Texas – could not seek financial compensation for the difference in the value of the vehicle and what they actually paid for it.
The vehicles, which were part of what was then the largest automotive recall in U.S. history, had faulty ignition switches that could, under certain circumstances, cause the vehicle to lose power, making the vehicle difficult to control and rendering the airbags inoperable.
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The switch was responsible for the deaths of 124 people and injuries to hundreds of others. GM has paid more than $2.6 billion in settlements and penalties related to the problem. The bellwether case, which acts as a predictor for other similar cases, is among the last parts of litigation related to the problem.
Manhattan-based Furman ruled against the owners because said the they failed to prove the fair market value of their vehicles and this created an “absence of evidence on an essential element” of their claims, making it impossible for a jury to assess damages, Reuters reported.
The judge also said that while damages could be measured by costs to repair defective vehicles, they could end up being zero if GM footed the bill, the wire service noted.
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GM scored a victory in court when a judge said it wouldn’t have to pay owners the difference between what they paid and the current value.
GM spokesman David Caldwell said the Detroit-based automaker was pleased with the decision, saying it dismissed the owners’ largest remaining claim.
Further, Furman’s decision also included an indefinite delay of the trial on the claims from the bellwether states, which was scheduled for Jan. 13, 2020. He noted that this decision alters the premise for going to trial, suggesting the parties may want to “revisit the issue of settlement.”
Steve Berman, a lawyer for the owners, told Reuters he may ask Furman to reconsider the decision, and was confident he could address the judge’s concerns in cases from other states.
“There has to be a damage remedy for consumers who unwittingly drove cars with serious safety issues,” Berman said in an email. “The car maker doesn’t get a free pass when it’s caught lying years later and then fixes the cars.”
(To see more about GM and the ignition lawsuits, Click Here.)
GM recalled more than 2.6 million vehicles since 2014 due to ignition switches that could cause engines to stall and prevent airbags from deploying. It was the largest automotive recall in U.S. history at the time but has since been surpassed by the Takata airbag recall.