GM And Global Law Firm Accused of Racketeering

Recall Lawyer News

A lawyer involved with the ignition switch lawsuits pending against GM has filed a new motion claiming that GM conspired with multiple parties in covering up serious engineering defects at the heart of multidistrict litigation against the company.

Friday, June 12, 2015 - Allegations of a cover up connected to the General Motors ignition-switch lawsuits have arisen while multidistrict litigation continues to build against the automaker. A lawyer from Texas has claimed that GM conspired with an international law firm in hopes of covering up the ignition switch scandal that has plagued the company in 2015 and looks to be headed for massive settlements.

The motion filed by the lawyer, who represents a number of plaintiffs suing GM over the ignition switches, claims that both the law firm King & Spalding and GM failed to report the ignition switch issues to regulators when they were first aware of the problems. The complaint claims that GM conspired with both King & Spalding and claims administrator ESIS to hide the ignition switch problem from the agencies that should have been alerted to the issues. The motion was filed as a violation of the Racketeer Influenced and Corrupt Organizations Act.

King & Spalding allegedly warned GM of potential settlement amounts more than three years before the first recalls began for vehicles affected by the ignition switch problems. ESIS was also named as being compliant in withholding pertinent information relating to the ignition defects. Neither of the companies are named as defendants in the suit, however.

The issue at the center of the lawsuits came from malfunctioning ignition switches in GM vehicles. The switches would move out of the ‘run‘ position during a crash, causing the airbags not to deploy. The deaths linked to the ignition defect has been connected to over 100 deaths and 200 injuries.

The complaint filed in the multidistrict litigation proceedings is seeking upwards of $10 billion in damages in connection with the ignition switch lawsuits. Plaintiffs are seeking financial restitution not only to help with injuries incurred as a result of the ignition switch defects, but also in hopes of recouping money lost in automobile value after discovering their vehicle was affected by the issue.

Though the multidistrict litigation is still pending, GM did already pay a $35 million fine that also brought along with it their acknowledgment of failing to promptly alert the proper regulatory bodies of the ignition problems.

More than 2.5 million vehicles were recalled in 2014 in relation to the ignition switch problem. A GM commissioned report prompted a push for the recall to take place as well as many other changes, including staff restructuring at GM and a new set of standards for the company‘s safety policies. The report, however, did absolve all high-ranking executives of any wrongdoing, claiming that the problem came from lower employees exhibiting a "pattern of incompetence and neglect."

Though the lawsuit filed against King & Spalding is the latest development in the ignition switch lawsuits, it is not the first mention of the two companies conspiring together in relation to the ignition switch lawsuits. Multiple accusations have been brought up concerning the two previously, which GM has been quick to deny. A victim‘s compensation fund has been set up by GM to the assist families of those injured or killed in connection with the ignition switch defects.