GM could face billions of dollars in legal claims after appeal is denied
A GM ignition-switch defect has been linked to more than 120 deaths and has led to 2.59-million vehicle recalls
Washington — The US Supreme Court cleared the way for potentially billions of dollars in legal claims against General Motors (GM) over a deadly ignition-switch defect, turning away the company’s appeal in a clash connected to its 2009 bankruptcy sale. The justices, without comment, left intact a federal appeals court ruling that said the accord, which turned "old GM" into "new GM," did not block lawsuits over accidents that happened before the sale or claims that the flaw caused vehicles to lose value. The ignition flaw has been linked to at least 124 deaths and led to 2.59-million vehicle recalls. Plaintiffs’ lawyers have estimated that claims against the company may total as much as $10bn. The company pointed to a federal bankruptcy law provision that lets a purchaser acquire a debtor’s assets "free and clear" of any liability. The appeals court said the provision doesn’t shield GM, because the company knew about the flaw before the bankruptcy and should have directly notified eac...
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