GM Settles Third Bellwether Ignition-Switch Case – Wall Street Journal
GM alerted a New York federal judge overseeing the litigation on Thursday that it had reached a confidential settlement with the plaintiff in the case, which involved the fatal crash of a Saturn Ion in Pennsylvania in November 2013. In a letter filed in a Manhattan federal court, the Detroit auto maker’s lawyers at Kirkland & Ellis LLP requested the judge remove the case from the court docket.
Lawyers for GM and the plaintiff “write to inform the court that the parties have entered into a confidential settlement term sheet designed to resolve all of plaintiff’s claims,” the letter said. A trial had been set for May.
The settlement marks another unexpected turn in the consolidated litigation over defective ignition switches on roughly 2.6 million older vehicles GM recalled in early 2014. GM has admitted to failing for more than a decade to recall the vehicles with the switches, which can slip from the run position and disable safety features including air bags.
Six so-called bellwether cases were set for trial this year with the goal of setting patterns for settlements in remaining ignition-switch lawsuits. The first case that went to trial in the multidistrict litigation proceedings earlier this year was dismissed after GM uncovered evidence the plaintiffs committed fraud. A second trial ended with a jury determining the ignition switch wasn’t to blame for a crash despite the part being defective. Some jurors in that trial were dismissed amid concerns they were sleeping.
GM and plaintiffs’ lawyers are scheduled to appear before U.S. Judge Jesse Furman in Manhattan on April 20 to discuss remaining cases set for trial.
GM has already reached settlements totaling more than $2 billion with the U.S. Justice Department, shareholders and thousands of consumers. The settlements include $595 million offered to victims through a compensation fund administered by outside lawyer Kenneth Feinberg and $575 million to resolve shareholder litigation and more than 1,300 other wrongful death and personal injury suits.
GM in September paid a $900 million penalty and admitted to misleading regulators and consumers about the defective switch when settling a criminal case brought by the Justice Department.
The settlement disclosed Thursday traced back to a 2006 Saturn Ion that crashed on Nov. 21, 2013, resulting in fatal injuries to the driver. James Yingling, 35 years old, lost control of the car and crashed into a steep culvert, according to a lawsuit his wife filed against GM. The lawsuit alleged the car’s air bags failed to deploy because the vehicle’s ignition switch slipped from the run position, cutting engine power. He left behind five children, and his wife, Nadia, the suit said.
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Corrections & Amplifications:
General Motors paid a $900 million penalty in September 2015. An earlier version of this article incorrectly stated the amount. (April 7, 2016)