Products Liability Law Daily GM not liable in bellwether ignition switch case
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Friday, July 21, 2017

GM not liable in bellwether ignition switch case

By Georgia D. Koutouzos, J.D.

A federal jury in New York cleared General Motors LLC of any liability for injuries sustained by the owner of a Chevrolet HHR that had rear-ended another vehicle on an Arizona road due to an allegedly faulty ignition switch. In the first of six test cases involving GM ignition switch-related damages, the jury found that the HHR owner did not prove that the automaker failed to exercise reasonable care in the manufacturing and/or design of the at-issue vehicle, failed to warn him of the alleged defect, or failed to comply with notification and reporting requirements (Ward v. General Motors LLC, July 19, 2017, Furman, J.).

An individual who was seriously injured in 2014 when his 2009 Chevrolet HHR impacted with another vehicle after having suddenly and unexpectedly lost power on an under-construction road in Arizona filed suit against General Motors LLC ("new GM")—the successor corporate entity to the vehicle’s manufacturer, General Motors Corp. ("old GM"), which entered into bankruptcy in 2009. Asserting claims for negligence, strict products liability, fraudulent concealment, and violations of Arizona’s consumer protection statute, the injured man alleged that both Old GM and New GM knew years before the date of his accident that the ignition switch in his HHR could fail if the vehicle experienced a jarring condition such as a bumpy roadway or if the key chain was carrying added weight, and yet the companies had concealed and obfuscated the defect.

The accident occurred just one day before New GM notified the National Highway Traffic Safety Administration that it was recalling 2006-2011 Chevrolet HHRs due to a safety-related problem whereby the vehicles’ ignition switch could inadvertently and unexpectedly move out of the "run" position to the "accessory" or "off" position when, among other things, the vehicles experienced rough road conditions or other jarring. As a result, the power failure also could disable the vehicles’ airbags, steering, and brakes.

According to the injured HHR owner’s complaint, both Old GM and New GM were aware of safer alternative designs but chose not to employ them due to cost factors and to avoid disclosure of the defective ignition switch and its consequences. Although New GM had recalled millions of vehicles for defective ignition switches, it knew that the problems transcended the low torque switch originally installed in vehicles subject to the above-mentioned NHTSA recall. As such, New GM’s recall of those vehicles was incomplete and inadequate, and it underscored the automaker’s fraudulent concealment and misrepresentation of the nature and extent of the defect, as well as failed to fully remedy the problems associated with it, the injured man maintained.

Furthermore, New GM had a duty no later than 2012—when it clearly was aware of the ignition switch problems—to disclose the defect in the subject vehicles. Rather than comply with its legal obligations, New GM continued to fraudulently conceal this defect from the public and the U.S. government, he contended, arguing that his vehicle might have been repaired before the accident occurred if a recall had been implemented earlier. Moreover, throughout the entirety of its corporate existence, New GM received numerous and repeated complaints of moving engine stalls and/or power failures in the subject vehicles, which constituted yet more evidence that the automaker was fully aware of the ignition switch defect and should have announced a recall much sooner than it did. Demanding a jury trial, the HHR owner sought compensatory and punitive damages.

The verdict. The jury determined that the injured man did not prove by a preponderance of the evidence that: (1) Old GM had failed to exercise reasonable care in the manufacture and/or design of his 2009 Chevrolet HHR; (2) Old GM and/or New GM negligently had failed to warn him about a defect in his 2009 Chevrolet HHR that made the vehicle unreasonably dangerous for its reasonably foreseeable use; or (3) New GM had failed to comply with applicable federal laws and regulations requiring notification and reporting, as specified in the jury instructions.

The case is No. 14-MD-2543 (JMF).

Attorneys: Diana Gjonaj (Weitz & Luxenberg, PC) and James J. Bilsborrow (Weitz and Luxenberg PC) for Dennis R. Ward. Andrew Baker Bloomer (Kirkland & Ellis LLP) for General Motors LLC.

Companies: General Motors LLC

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