US: bankruptcy judge puts on hold GM’s ignition-switch related lawsuits image

A US bankruptcy judge decided recently to ice the numerous lawsuits that accuse General Motors of concealing and misleading consumers in regards with its ignition switch recall.

The new decision is part of the appeal process as the plaintiffs that accused the largest US automaker of wrongdoing were seeking the change of an earlier decision that barred their claims. GM has called the bankruptcy judge to defend the company as it believed the claims made for vehicles before its 2009 exit out of bankruptcy restructuring should be deferred to the company called “Old GM” – a shell of the automaker. On April 15, U.S. Bankruptcy Judge Robert Gerber decided the company deserved the shield awarded back in 2009 as part of the process. On the other hand, this Wednesday Gerber decided to simply “stay” the cases for the time being instead of dismissing them as the carmaker requested, because it would become procedurally “cumbersome” if a higher court would decide to overturn his decision. The plaintiffs also have another field of battle – the district judge in Manhattan is overseeing at least 200 cases, consolidated against GM because of the initial ignition switch flaw and subsequent safety campaigns.

The GM customers that went to court against the company argue the faulty ignition switch that was initially recalled in 2.6 million older cars and later on in millions more have caused lost value because of the negative publicity – while other plaintiffs focused on fatalities and injuries associated with the defects. Also, the April decision did not affect in any way the cases that were brought against the company and involving vehicles made after 2009.

Via Reuters