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GM shielded from legal claims through bankruptcy filing?

While General Motors has been in the process of recalling 1.6 million cars concerning its ignition system, GM may still attempt to gain post-bankruptcy immunity from legal claims.  When GM filed for bankruptcy restructuring in 2009, it was granted this immunity for products liability and wrongful death lawsuits that would arise from claims that occurred prior to July 10, 2009.

A number of safety advocates are asking GM to waive this immunity.  One advocate also requested that GM set up a $1 billion fund to assist those victims injured because of safety defects and whose claims would now be barred for various legal reasons.

There have reportedly been 12 deaths involving accidents connected to the claimed defective ignition switch.  Five of these cases were said to have occurred prior to the bankruptcy.  Though there has been 31 crashes reportedly linked to the ignition switch, this is thought to be “just the tip of the iceberg.”

Investigators and regulators are still curious as to when the company first knew about this matter.  The National Traffic Safety Administration has reported that they informed GM of this issue in 2007.  And GM apparently knew of one incident concerning a Chevy Cobalt losing power back in 2004.

Defective product lawsuits are nothing new. We have seen similar claims concerning defective automobile parts in Central Illinois as well.  Yet while the results of accidents involving such products can be tragic, these are often complex type cases to bring.  As the above circumstances indicate, large corporations often have a number of legal defenses at their disposal.  It’s for this reason experienced attorneys are needed to explore every possible avenue for legal recovery.

Source: USA Today, “GM urged to waive bankruptcy immunity for recall suits,” Todd Spangler, March 12, 2014

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