Chrysler to accept more product liability claims

[August 28, 2009]  AUBURN HILLS, Mich. (AP) -- Chrysler Group LLC said Thursday it will accept product liability claims in a broader number of cases than originally planned in its reorganization under bankruptcy protection.

The automaker said it will now consider product-related lawsuits from consumers involved in accidents that occurred after Chrysler emerged from bankruptcy protection in June that involve vehicles manufactured by the old company.

A company spokesman said the changes do not include product liability claims filed before the company's April 30 filing.

John Bozzella, Chrysler Group LLC's senior vice president for external affairs and public policy, said the company was confident "that the future viability of the company will not be threatened if we accept these claims." He said the new company's approach was "consistent with that taken by General Motors as part of its bankruptcy process."

Consumer groups and individuals with product-related lawsuits contested a condition of the Chrysler sale to Italian automaker Fiat Group SpA that would release the company from product liability claims related to vehicles it sold before the asset sale.

Compensation for such claims would have had to come from the parts of the old company not sold to Fiat. But those assets have limited value and would be unlikely to have anything to pay out.

Joanne Doroshow, executive director of the Center for Justice and Democracy, said Chrysler had "responded to pressure from injured victims and consumer groups and we commend them for taking this important step to protect public safety."

Doroshow said that "while this decision is a victory for consumers, there are still hundreds of people who were injured before the bankruptcies by defective Chrysler and GM vehicles that still have no recourse because the companies continue to take no responsibility for pre-bankruptcy deaths and injuries."

[Associated Press]

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.