If you were injured before 2009 in a car wreck caused by a faulty ignition switch in a General Motors vehicle, you can still seek damages. The U. S. Supreme Court recently declined to hear an appeal from GM, opening the door for claims that pre-date the company’s emergence from bankruptcy proceedings.
The ignition switch problem started as far back as 2001. Switches in certain vehicles would suddenly switch from “on” to “accessory” or “off,” while being driven. This caused the power brakes and power steering to quit working, often resulting in a crash. Adding insult to injury, when a car wrecked, the airbags would not deploy.
It wasn’t until 2014 that GM recalled cars with the switches. By that time, however, hundreds of people had been killed or injured. In 2009, GM emerged from bankruptcy, and subsequently paid out $2.5 billion for settlements and costs arising from wrecks that occurred after the bankruptcy. But because the switch problem started much earlier than the bankruptcy, there are many wrecks that occurred before 2009 that may be attributable to the switches. Some people may not even be aware that their wreck was caused by a bad switch.
Under normal bankruptcy law, GM would only be liable for product liability suits over injuries sustained after the bankruptcy, even if caused by vehicles manufactured before the bankruptcy. This is known in legal circles as the “bankruptcy shield.”
The problem for GM, however, is that a federal appeals court ruled that it was not entitled to the shield because it had known of the defective switches before the bankruptcy. GM was under an obligation to disclose all pending debts against the company, but it did not disclose the potential for litigation over the faulty switches. This denied potential claimants the opportunity to be heard during the bankruptcy proceedings.
GM had appealed the lower court’s ruling, hoping the Supreme Court would find that it was indeed entitled to the bankruptcy shield. The Court simply declined to hear the case, which allows the appeal court’s ruling to stand.
If you were injured in an accident before 2009 that involved one of the recalled cars, you may still be able to bring a claim. Contact the Alexander Law Group, LLP online, or call 888.777.1776. We’ll fight for you to receive your day in court.
