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GM Accepts Product Liability for Future Claims

Posted by Jane Akre
Monday, June 29, 2009 11:46 AM EST
Category: On The Road, Major Medical, Protecting Your Family
Tags: Product Liability, Chrysler, General Motors, Defective Autos, American Center for Van and Tire Safety, Center for Justice and Democracy

Alexis James died in a 15-passenger Chrysler van. Her pending lawsuit is wiped clean under the Chrysler bankruptcy.
Lexi James

Concession To Move Forward 


Lexi James Chrysler van ejected her and killed her in a rollover.
Lexi's van


IMAGE SOURCE: American Center for Van and Tire Safety 


General Motors Corp. has agreed to take on future liability claims from defective autos and parts as a means to a quick sale and emergence from Chapter 11 bankruptcy.

In a court filing Friday, June 26, GM asserts it will still leave behind claims by victims of past accidents.

Protests from consumer groups had threatened to block the sale, and when state attorneys from Ohio and Connecticut and seven other state objected to the GM bankruptcy plan, GM agreed to the concession.  

“To alleviate certain concerns that have been raised on behalf of consumers as to future products-liability claims” the new GM will assume the claims of victims driving GM vehicles “regardless of when the product was purchased,” reports Bloomberg.

GM filed for bankruptcy June 1 with $82 billion in assets and $172 billion in debt.  Under the government sponsored plan, GM wanted to avoid assuming any liability for product-liability claims made by injured consumers.  The bankruptcy proposal by Chrysler LLC allowed the company to sell assets “free and clear of tort claims and successor liability.”

A hearing is scheduled for Tuesday. 

While injured consumers with pending claims are left out, GM says it will pay “lemon law” claims, which allow consumers to seek a refund or a replacement for their defective vehicles.

Joanne Doroshow, of the Center for Justice and Democracy calls the move reprehensible.

“We are happy they’re going to be assuming future liability claims but to let the people who have claims pending out of luck, it’s morally reprehensible.”

Every year up to 1,000 serious injuries result from cars built with defects including – seatbelts that fail, seat backs that collapse, unstable vehicles that flip, roofs that crush in causing brain injury, cars with gear shifts that reverse on their own, exploding gasoline tanks or parts that catch fire and explode reports the Center.   

Lexi James

Patrick James' family is left out in the cold.   His 10-year-old daughter, Lexi, died two years ago when the Chrysler 15-passenger van in which she was riding had a left tire blowout. Even though she was wearing a seatbelt, she was thrown from the vehicle when it rolled four times. James had an action against Chrysler which is now wiped clean.

“My reaction is shock as a family. There needs to be accountability and we should have our day in court, my daughter’s death should be more important than car parts,” he says.

“She died and our govt. is saying they don’t care. And it’s a really sad feeling.”  

James has taken his knowledge of the dangers of 15-passenger vans forming a nonprofit the American Center for Van and Tire Safety to raise awareness about the dangers of the vans. He is working with NHTSA on van safety standards and testifies regularly to lawmakers.   

He will now be forced to pursue an action against the tire manufacturer for failing to make the date of a tire easy for consumers to read.  The tire on his daughter’s van was 13 years old, long past the six year life span of a tire.  And he says he will sue the car dealership. James will not pursue a million dollar umbrella policy of the driver because he is a friend and as James says this is about accountability not money.   

James says he comes from a military background and is proud to be an American but is very disappointed in his government. “I’d love to get in front of the Treasury secretary and show them pictures of my daughter and ask them how could they approve this to an Italian company when it wasn’t a deal breaker?”

Fiat had initially agreed to assume Chrysler’s pending product liability lawsuits, but in final negotiations the automaker eliminated that liability.

“They should have been something worked out” he says.  #


Anonymous User
Posted by Susan G
Monday, June 29, 2009 12:33 PM EST

Gm does not care about any costs, as they are being payed by the US TAXPAYER. So why would GM care what it agrees to pay, as long as it keeps this FAKE bankruptcy moving forward.

Anonymous User
Posted by Karen Johnson
Thursday, July 02, 2009 6:43 AM EST

If GM can make it to July 10th, GM would be able to shake loose from the Goverment's claws. The Treasury says at this date,,will allow GM to re-organize without a goverment bankruptcy. Let's all prey GM will be able to make it to July 10th, and our Government keeps it's word to get out of GM's business.

Comments for this article are closed.

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