New York, New York

HomeNew YorkNew York

Email Steven Cohn
Steven Cohn
Steven Cohn
Attorney • (888) 480-1123

Parties Agree to Settlements in Two GM Ignition Switch Lawsuits in New York

Comments Off

General Motors (GM) announced on September 5, 2016, that it had settled the last two bellwether cases concerning GM’s faulty ignition switch. The last of the four cases was scheduled to go to trial on September 12th.

Over 200 cases were centralized in the Southern District of New York back in June 2014. Plaintiffs claimed that GM took way too long to fix the defective ignition switch, which prompted a recall of 2.6 million vehicles in the U.S.

GM Delays Ignition Switch Defect for Over a Decade

For at least a decade GM was aware of the safety issues associated with its defective ignition switch. The switch could turn to the “off” position out of the blue, robbing the brakes, steering, and air bags of power. If this occurred during an accident, the air bags would fail to deploy, increasing risk of occupant injury and even death.

GM defective ignition switches were linked with 124 deaths and 275 injuries. Way back in 2001, the company noticed a problem during pre-production testing of the Saturn Ion. The issue continued to come up in testing in 2003 and 2004, and in 2005, GM rejected a fix to the allegedly because it would be too costly.

At the end of that year, the company sent letters to dealerships warning them about the defect, and stating that it could occur if the driver had a large or heavy key chain. GM advised dealerships to warn drivers to remove unessential items from their key chains.

In April 2007, an investigation into a fatal crash linked the accident to the ignition switch defect, but regulators did not investigate. After the NHTSA recommended a probe into the failure of air bags to deploy in crashes involving Chevy Cobalts and Saturn Ions, the results showed no link.

It wasn’t until 2012 that GM identified four crashes and four corresponding fatalities along with six other injuries from four other crashes that GM said were attributable to the ignition switch defect. The company didn’t start recalling the vehicles with the defective switches until February 2014.

GM Pays Out $2 Billion in Penalties and Settlements

Drivers who were injured in GM vehicles, families of those who were injured or killed, and those who believed their vehicles lost value on the market because of defective ignition switches, filed claims against GM. The company set up their own settlement fund and paid out about $600 million, but plaintiffs who didn’t accept payouts were still eligible to file their own personal injury lawsuits.

Those filed at the federal level have been proceeding in New York for the last couple years, with the first cases going to trial at the beginning of 2016. The first bellwether trial was dismissed by plaintiffs, and GM was cleared of liability in two others. Now, two more cases have resulted in undisclosed settlements.

The first of these was filed by a Virginia resident, who said she sustained injuries in 2011 after being involved in a single-vehicle crash in her 2006 Chevy Cobalt. The other case was scheduled for later in the year.

The settlements may indicate that the company will be able to quickly resolve the rest of the remaining cases in the consolidated litigation. GM has so far paid out a total of about $2 billion in criminal and civil penalties and settlements related to the switch, according to Fortune.