GM Fights Lawsuits and Fraud Allegations

As if millions of vehicles recalled in recent weeks wasn’t enough for GM to handle the company is also several lawsuits from car-owners. Alleging that GM knew information about the faulty ignition switches and withheld that information in their 2009 Chapter 11 bankruptcy case , which could grant them immunity from lawsuits since the discharge.

Angry Crowd

After being served with multiple lawsuits from unhappy victims and their families, GM has asked the court for protection from liability. GM has said that they are still considering compensating victims for related crashes, but have made no promises. Currently, GM is not legally liable for any accidents or injuries that occurred before the close of their bankruptcy case in 2009. That liability belongs to the old company that was restructured through the Chapter 11.

The case isn’t one of black and white, did they commit fraud or didn’t they. Experts report that even if bankruptcy fraud is proven, that doesn’t guarantee the victims compensation. The claim deadline expired four years and six months after the completion of the case; meaning victims may have lost their chance to fight. However, the decision over fraud and victims compensation isn’t final and the court will meet again May 2 to review further evidence.