GM Settles Ignition Switch Lawsuits For $900 Million

Recall Lawyer News

General Motors has agreed to a $900 settlement with plaintiffs who claims that the automaker knew of serious issues with ignition switches in thousands of vehicles and failed to warn consumers of the potential danger the malfunction posed to drivers.

Monday, September 21, 2015 - General Motors paid more than $1.4 billion to settle a series of criminal, personal injury and civil lawsuits filed against the company relating to their defective and deadly ignition switches.

The multidistrict litigation surrounding General Motors (GM) and the defective ignition switches that were installed in cars nationwide has received a good sign that talks with plaintiffs will be progressing soon, as GM finally reached a $900 million settlement in response to federal criminal charges. Federal prosecutors with wire-fraud charges, among other claims, are among a number of parties filing lawsuits against GM.

With the announcement of the federal settlement, GM has also reached a deal with more than half of the multidistrict plaintiffs that filed personal injury and death lawsuits against the automotive manufacturer. The company also announced that a pair of civil lawsuits filed by shareholders that had been settled. The multidistrict litigation cases in tandem with the civil suits combined to reach $575 million in settlement funds, however the individual amounts paid to claimants were not released.

There still remain multidistrict litigation cases in the proceedings, which consist of those tied to economic loss connected to the defective ignition switches as well as the remaining cases from the lawsuits left out of the announce personal injury and death settlements. There are roughly 450 personal injury cases left in the multidistrict litigation.

The ignition switch defect named in the allegations caused the ignitions in a number of GM vehicles to

switch to the run setting during crashes, nullifying the ability for airbags to deploy. This resulted in a series of horrific crashes, many of them resulting in the death of passengers in the vehicles. More than 100 deaths have been reported from the ignition problems thus far, as well as hundreds of injuries. Plaintiffs are claiming that the manufacturer knew of the problems regarding the ignition switches more than a decade ago, but chose to keep their findings secret until the rash of injuries and investigations into the defect became so prevalent that the company had to address the problem. Thus far, no executives have been implicated individually, as the problem was said to be a "pattern of incompetence and neglect" exhibited by lower ranking employees.

GM has paid out more than $2 billion thus far following the discovery of the ignition switch failures. There have been claims of wire-fraud, failure to disclose safety measures, and even allegations that GM conspired with international law firm King & Spalding in an attempt to cover up the ignition switch information from becoming public. The company has fallen more than 15 percent over the last year, largely due to the economic fallout of the ignition switch issue and the more than 2 million vehicles that had to be fixed pursuant to the massive recall the auto maker had to make in the wake of the ignition problems.

U.S. Attorney Preet Bharara who brought the federal charges against GM claims that there may remain legal action to be taken against the company, including the possibility of individual criminal charges against those responsible for allegedly covering up the evidence of the serious safety hazards posed by the ignition switches. Bharara believes there are example throughout the history of the ignition switch scandal