GM Settles for $120 Million in Ignition Switch Scandal

GM to pay crash victims after years of covering up dangerous problem.

Ignition Switch ScandalGeneral Motors has hammered out a deal to pay $120 million for faulty ignition switches that killed or injured hundreds of people. The settlement will resolve the final cases in the scandal and involved thousands of vehicles, including 2005-2010 model year Chevrolet Cobalts, 2007-2010 Pontiac G5s, and 2003-2007 Saturn Ions, among others.

These and other claims resulted from crashes caused due to placement of the ignition switch. In millions of cars, the switch was positioned so that drivers could easily and inadvertently knock it into the “off” position with their knee while operating the vehicles. When this occurred, the autos would turn off and safety features, including airbags, were disabled. Drivers were unable to control the vehicles, and many terrible accidents and horrific injuries and deaths occurred.

During litigation, GM was forced to submit documents that showed the company was not only aware of the issue, but they tried to hide it for 13 years, going so far as to redesign the ignition switch without changing the part number in order to keep from raising suspicion. In fact, they first noticed the defect in 2001 during pre-production testing of the Saturn Ion. In 2005, they rejected a proposal to fix the problem because executives deemed it would be too costly. In 2007, when the first deaths were reported, GM investigators failed to launch an investigation, despite numerous warning signs, by then, that the ignition switches were to blame.

The settlement is still awaiting approval by U.S. District Court Judge Jesse M. Furman. Once it is approved, GM has agreed to pay drivers or their survivors $120 million, plus an additional $34.5 million in legal costs. About $50 million of the settlement will be paid from a trust established after GM’s 2009 bankruptcy; the remaining money will be paid directly from GM’s profits.

Previously, the court ruled that cases in which injury or death occurred prior to 2009 could not be heard. Later, that ruling was reversed. The majority of claims settled in this latest development were among those cases.

In total, more than 3,000 personal injury and wrongful death claims were filed in Judge Furman’s court. Some were resolved in court while others were dismissed.

In addition to the monetary compensation claims, GM was forced to recall more than 2.6 million vehicles. According to a blog on the company’s website, it now uses the scandal as a training module for new employees, it says, as an effort to take full responsibility for the deaths and injuries they caused.

Successful outcomes of thousands of GM ignition switch lawsuits has forced the company into transparency and responsibility. It’s one more example of how mass tort cases can ultimately make a difference by holding corporations accountable when they put profits over people, and how together, we can save lives.

If you or someone you love has been injured or killed by a dangerous or faulty product or vehicle, contact OnderLaw for a free, no-obligation consultation. We take on corporate giants, and together, we can make a difference.

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