Judge allows punitive damages in GM ignition switch cases

A ruling by a federal bankruptcy judge may benefit those Kentucky motorists who were affected by the faulty ignition switches present in countless General Motors vehicles for more than a decade. The judge’s ruling now makes it possible for plaintiffs who file a lawsuit against GM involving the faulty ignition switches to demand the company pay punitive damages related to its alleged misconduct in handling the situation.

A prior ruling by the same federal judge in New York in early 2015 stated that the company’s 2009 bankruptcy protected it from any civil litigation that involved crashes occurring before the bankruptcy took effect. The bankruptcy ruling ultimately resulted in the creation of a brand new company referred to as “New GM”, which replaced the original so-called “Old GM” once the bankruptcy proceedings were finished. Under this arrangement, New GM could only be held legally responsible for losses caused by GM vehicles with defective auto parts that took place after the 2009 bankruptcy.

However, according to the same judge’s November 7 ruling, New GM inherited much of the same personnel, technology and information of Old GM. This meant that plaintiffs in a civil suit could sue New GM for punitive damages related to a crash if they were able to prove that New GM was a negligent manufacturer by being aware of the defective products. As GM has already disclosed that numerous employees of both New GM and Old GM, including engineers, lawyers and safety technicians, were aware of the problem for several years before the 2014 recall, plaintiffs may find themselves receiving considerable judgements from juries.

Individuals who are injured or killed by dangerous products may be entitled to significant compensation from the negligent manufacturer. An attorney may be able to assist plaintiffs in obtaining compensation by negotiating a settlement with the company or filing a civil suit in court.