Gavel - LawCall

In 2014 General Motors recalled 30-million vehicles for faulty ignition switches and other safety issues. The company knew about the problems for years and attempted to cover up and downplay the issues. 15 senior GM executives were replaced in attempts to downplay the scale of the problems.

Now, the company has struck a deal that will ensure no one from GM serves any jail time. This, in spite of the face that Federal prosecutors have been investigating GM since March of 2014 when the company admitted to regulators that it had known about the ignition switch problems before taking any action.

The company knew that in some cars the ignition switches would fail, switching off the engine at high speeds and disabling the vehicle’s airbags, power steering and even the power brakes. So far the scandal has cost the company $4.2-billion.

In the latest deal, GM has agreed to a $900-million settlement in an attempt to prevent the company’s executives from facing any criminal charges over the cover-up. 124 people have died in vehicle accidents because of the defects, and countless others have been seriously injured. The company is also accused of hiding the defect and defrauding consumers.

Engineers and managers at GM knew about the ignition switch problems a decade ago, yet did nothing to remedy the situation. The U.S. Department of Transportation last year imposed its stiffest fine against GM – $35-million, which the company agreed to pay.

While GM is facing more than 200 civil lawsuits over the faulty switches and other safety issues, a judge who oversaw the company’s 2009 bankruptcy has ruled that claims related to issues pre-2009 are barred from prosecution.

Plaintiffs are seeking damages for injuries and deaths blamed on the vehicle defects as well as economic losses such as lost vehicle value. The first civil case is on the docket for January 2016.

What do you think – should executives and engineers who knew about these defective ignition switches be immune from serving prison time? And, GM was bailed out with tax payers’ dollars – why are they now protected from prosecution for cases dating before 2009?


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