DETROIT (AP) — A federal bankruptcy judge ruled Wednesday that General Motors is shielded from death and injury claims potentially totaling billions of dollars tied to defective ignition switches in certain GM small cars. In 2009, a bankruptcy court allowed GM to emerge from bankruptcy protection free from the liabilities of the old company. Plaintiffs argued that GM misled the court because it knew about but failed to disclose the problem with the ignition switches. The switches are now linked to at least 84 deaths.
Judge Robert Gerber denied that argument, but did rule that under narrow circumstances, some plaintiffs who sued over a loss to the value of their cars due to faulty ignition switches can file claims against the company for actions after it left bankruptcy protection in 2009.
The ruling is a victory for GM. One plaintiffs’ attorney said the decision shields GM from $7 billion to $10 billion in potential liabilities from lawsuits. Lawyers for plaintiffs in more than 140 lawsuits had argued that their clients never got a chance to dispute the bankruptcy order because GM concealed the defective ignition switches. But the new GM contended that when it bought assets from the old GM in the 2009 government-funded bankruptcy, the new company got them “free and clear” of liabilities before the bankruptcy.