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GM’s Plan to Pay $22 Per Car Not Good Enough

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Montgomery, ALEver vigilant on this GM file, the lawyers representing families and victims of GM’s catastrophic ignition failure are extremely critical of the $400 million compensation plan as laid out in a report to shareholders. That would work out to about $22 per vehicle according to lawyers.

“This estimation to pay claims for deaths and serious, disabling injuries is totally inadequate, and is not consistent with a no-cap compensation fund,” says Jere L. Beasley from Beasley Allen, whose firm represents GM victims. “The fund doesn’t even include all of the recalled cars, and there have been deaths and injuries involving those cars.”

The evidence shows that as far back as 2005, GM was aware of an ignition switch problem that caused the engine to shut off unexpectedly. GM engineers and executives did not consider the issue to be a “safety problem” and did nothing to change, upgrade, recall or in any way protect drivers from the faulty mechanism.

The company’s CEO, Mary Barra, told legislators in Washington at a special hearing several months ago that “obviously there was problem.”

GM now acknowledges that there were 13 deaths and 54 crashes related to the ignition switch shutdowns. However, the faulty ignition switch was installed in more than 17 million cars and many consumer advocates strongly believe that the number of deaths is more likely in the 300 range.

The long lag period between the time the problem began and the time that GM admitted the error and began the recall is some 14 years. It is possible that many, many more people were injured and have not connected their crash to an ignition switch failure issue.

Attorney Lance Cooper, from Marietta, Georgia, who represents a number of the families injured in the GM ignition switch disaster says “$400 million is an arbitrary number.

“And if GM is really serious about giving the head of the compensation team, Ken Feinberg, complete discretion to make awards, that $400 million number is irrelevant,” he adds.

“What is most important is that Mr. Feinberg does the right thing and makes full and complete awards for all eligible claims regardless of the ultimate total amount awarded,” says Cooper. “If he does that, given our understanding of the number of claims, the number will certainly wind up being much higher than $400 million.”

Both lawyers consider the $400 million number offered to shareholders as an estimate to be “especially low” given that GM is trying to keep victims from filing claims against the “Old GM” - arguing that all accidents that happened before GM went bankrupt during the financial crisis would have to be compensated from the fund because a defunct company can’t be sued.

“They would also be shut out of the right to trial by jury, thus avoiding punitive damages,” says lawyer Beasley.

“On June 5, GM CEO Mary Barra told the public and her employees that GM is going to do the right thing for the affected parties,” comments Beasley.

“Apparently, somebody else at GM is now calling the shots on the automaker’s litigation strategy. It’s time for GM to quit playing games and come clean about its massive safety problems.”

GM is also the target of several other class actions related to defective windshield wipers, faulty intake manifold gaskets and transmissions.


Lance Cooper founded The Cooper Firm in 2006. With experience in substantial personal injury and wrongful death cases, he has represented plaintiffs in numerous civil jury trials and has successfully prosecuted hundreds of cases and gained multimillion-dollar verdicts and settlements on behalf of his clients.

Headquartered in Montgomery, Alabama, Beasley Allen is comprised of more than 75 attorneys and 200 support staff. Beasley Allen is a national leader in civil litigation, with verdicts and settlements in excess of $22 billion.

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READER COMMENTS

Posted by

on
Faulty ignition switch in the 2000 Monte Carlo. Car would still drive without the key in the actual ignition switch.

Posted by

on
Both my Cadillacs (2001 and 2007) were on this recall. Having bugged them to death about when the ignition key fix would be available, they finally set me up with appointments with my local GM dealer but when, after the supposed fix, I asked if I could put my ignition keys back on my key rings they told me GM had told them to officially tell customers to continue to keep the key separate. Huh? What was the point in all of that, then? Makes you wonder just how 'fixed' the thing is.

I would never buy another GM product after this fiasco and I am planning on getting rid of at least one of the two GM vehicles I have now. I prefer to have an alternative brand sitting in my driveway so I am never again forced into picking which unsafe GM car I care to drive that day.

Posted by

on
Friday 11/21/2014 my 2007 Chevy cobalt lost steering and braking i slammed into a guard rail at 65 mph my airbags failed to deploy luckily i only sustained minor injuries. On sat 11/22/2014 I received the recall letter in my mail. And to add insult to injury I received a ticket for failing to control the vehicle which I intend to fight.

Posted by

on
I own a 03 Impala that got a recall for ignition switch and the fix was gluing a three dollar plastic piece onto each of my ignition keys. They say this will keep things attached to the ignition key from moving back and forth. I guess fixing the ignition itself got to expensive for General Motors.

Posted by

on
If you think that is bad i own one of the vehicles that is being recalled. A 2002 Pontiac Grand Am. I called them and asked them about the recall and they tried to tell me first that my car is indeed one of those recalled but then they tried to tell me it wasnt. I call bullsh*t on that because I am already having problems with the ignition switch. I cant hardly get it to turn the key to turn on the car and also I want to note the faulty door/window regulators on both the drivers & passenger sides in front which DIED before the warranty on my car was out. also the cruise control that DIED right after I bought my car and I took it to a dealership to have it replaced and they completely ignored me & refused to do it and it was under warranty and both of my turn signals are faulty along with a problem with the computer control module and all of this started when the car was under warranty. I am the original owner. And this car eats brakes like crazy and that is without me even riding the brakes. UNREAL. I dont deserve this crap. I have to drive around with sealing tape on the outside of my windows to keep my windows up and it looks totally ghetto. and the paint is starting to come off my car too. BULLSH*T.

Posted by

on
Gm got a simulas package> they should be ashamed of themselves for dropping Saturn which was making money for them. i think that Gm should make good for any recalls since they created this problem in the first place. Shame on them, for being to gready. Bring back Saturn .!!!!!!

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