P&A Providers & Administrators
MenuMENU
SearchSEARCH

GM Urges Judge to Bar $10 Billion Ignition-Claim Lawsuits

November 7, 2014
3 min to read


General Motors Co. (GM) urged a judge to reject lawsuits demanding $10 billion for the lost value of millions of cars recalled this year for ignition-switch fixes and other flaws, reported Bloomberg.


The automaker yesterday told U.S. Bankruptcy Judge Robert Gerber in Manhattan that he freed it from responsibility for past errors when he signed off in 2009 on a $49.5 billion government bailout. In a court filing, GM challenged customers’ claim that it forfeited immunity by hiding a long-known defect and exposing them to accidents and financial losses.

Ad Loading...


If Gerber scraps or adjusts earlier rulings, the judge might let customers fight for billions of dollars in damages and penalties, or at least the lost value of their cars. If Gerber sides with GM, customers suing over the defect might get nothing or be sent to old GM, the corporate remnant the automaker left behind when it reorganized. That company has little money to pay claims after being saddled with the carmaker’s worst assets and liabilities.


“New GM had no involvement” in what old GM, which was responsible for switch defects, told customers about them, the company said in the filing. “New GM purchased old GM’s core assets in good faith.”


GM’s filing yesterday is the first step toward a 2015 decision by Gerber on whether his earlier rulings on immunity still apply after an investigator found that GM engineers and lawyers knew about the defect for at least a decade. A report by Anton Valukas, a former federal prosecutor, spurred federal probes, a record fine and more than 150 lawsuits.


Separately, a federal judge in Manhattan yesterday set a January 2016 trial date for a group of GM’s accident victims, said customer lawyer Bob Hilliard.

Recall Crisis

Ad Loading...

GM has responded to a recall crisis by starting to settle claims for people who had accidents in older cars with faulty switches. The Detroit-based automaker has said it will fight all other suits. It has asked Gerber to reject non-switch claims for pre-bankruptcy accidents as well as money-loss claims and penalties over ignition-switch defects in vehicles made before bankruptcy.


About 130 car-price lawsuits against GM have been combined in two class actions in U.S. District Court in Manhattan. One group suit is over cars made before the bankruptcy, and the other is for automobiles purchased afterward. Of 30 million cars represented in the suits, 14.7 million were made by old GM, the carmaker said.


While customers in the two suits don’t say how much they want for price declines, GM said their “alleged reductions in value” since the recall imply actual damages of $7.4 billion. That’s without counting the punitive damages that most customers want.


In its filing yesterday, GM focused on cases over older cars.


Car owners haven’t proved their contention that new GM owes them money because old GM denied customers a chance to put in claims during the bankruptcy, the automaker argued. The company also objected to customers’ “opaque hypothesis that they could have coerced new GM” into compensating them if they had demanded it at the time.



More Industry

Photo of gray SUV plugged into public electric-vehicle charger in parking lot
Industryby Hannah MitchellJuly 21, 2026

World EV Adoption Set to Grow

A new report says the segment, despite recent setbacks in some regions, is poised for acceleration as many countries look to reduce pollution.

Read More →
Bar chart of truck and SUV segments' weekly value change
Industryby StaffJuly 21, 2026

Black Book: Weekly Market Update

Wholesale automotive auction business stayed steady last week as bidders encountered lower prices, analysts observed.

Read More →
laptop with blue car on screen on a shopping website, Clear Costs Convert
Industryby Lauren LawrenceJuly 21, 2026

Pricing Transparency Drives Purchase Consideration

An annual study by JD Power found that clear pricing matters to consumers on automaker websites, so much so that it increases their purchase consideration.

Read More →
Ad Loading...
Bar graphic of used-car segment weekly change
Industryby StaffJuly 14, 2026

Black Book: Weekly Market Update

Used-vehicle market depreciation was the prevailing story in the wholesale market last week.

Read More →
Light-blue Fiat car parked on a sunny Chicago street
Industryby Hannah MitchellJuly 14, 2026

Smaller Is Looking Better

A growing number of Americans in the market for a new vehicle are opting for more affordable options, not waiting for market stability to bite the bullet.

Read More →
man sitting at desk using calculator with charts in front of him, to-go coffee cup on desk, rising and falling data chart in front
Industryby Lauren LawrenceJuly 14, 2026

U.S. EV Market Slowly Stabilizes

U.S. electric-vehicle interest is slowly stabilizing since a major dip in sales after last year's end of the federal EV tax credit, and hybrids remain the leading electrified power train.

Read More →
Ad Loading...
blue background, map of the world with connecting lights and an electric vehicle emblem in the middle
Industryby Lauren LawrenceJuly 8, 2026

Global EV Market Entering New Phase

Automakers are making investments to lower battery costs and optimize production to meet changing consumer needs.

Read More →
Bar chart showing week-over-week wholesale automotive price change
Industryby StaffJuly 7, 2026

Black Book Weekly Market Update

The holiday weekend, not surprisingly, put a drag on wholesale automotive activity last week, analysts observed.

Read More →
Photo of Honda CR-V SUV on two-lane road next to roadside trees
Industryby Hannah MitchellJuly 1, 2026

Auto Affordability in Context

Cox Automotive points out the complex circumstances that have led to eye-popping vehicle prices.

Read More →
Ad Loading...
Line chart of used-vehicle days to turn over past week
Industryby StaffJune 30, 2026

Black Book: Weekly Market Update

Automotive auction inventory increased last week, giving choosy bidders even more leeway.

Read More →