Posted in News on September 25, 2015
Montana residents may be interested to know that General Motors Co. has decided to forgo a contentious legal battle and instead has agreed to pay $900 million in settlement for criminal charges against it. Additionally, GM also agreed to pay federal regulator the maximum penalty of $35 million to settle civil charges.
The automotive maker has been embroiled in a legal battle for over 18 months over the fact that it sold cars with defective ignition switches that would shut down the car’s engine while the car was being driven. This serious car defect resulted in dangerous situations, because the driver would lose the power steering and power brake functionalities making the car extremely difficult if not impossible to maneuver safely and come to a complete stop. Additionally, the vehicle’s airbag safety system would also be rendered inert and functionless because of the defect. To date, the defective ignition system has been tied to at least 124 deaths.
What made this particular recall especially egregious is that GM has acknowledged that its engineers and executives were well aware of the problem for the better part of the last decade. Surprisingly, no action was taken by GM to remedy the problem and replace the faulty and defective ignition systems until last year when it finally issued a recall to fix the problem.
According to the U.S attorney, current law does not deem it illegal for a company to sell cars that contain defects. The Department of Justice nevertheless decided to charge GM for its failure to report the defect for nearly a decade. For the families of the 124 people who lost their lives due to a known car defect, the outcome of the case may be hard accept. For more details about car defects and product liability cases, it may be helpful to consult with a local product liability lawyer.
Source: CNN Money, “GM CEO: ‘People died in our cars’,” Chris Isidore, Sept. 17, 2015