|
 The lawyer of one family said he could challenge the agreement,
alleging that the automaker fraudulently covered up the problem, and
his clients intended to try. A second family also told Reuters it is
preparing to try to break the deal and then sue GM. Neither family
has yet done so, however, and trying to win such actions will be
difficult.
To undo a settlement, plaintiffs would have to convince a judge that
they were intentionally misled or defrauded by the other party,
according to legal experts and plaintiffs' lawyers. If the families
were successful in setting aside the settlements, they could then
sue GM.
GM, which on Friday increased a global recall of vehicles because of
the ignition switch problem by almost a million to nearly 2.6
million, declined to comment on specific suits or pending
litigation. In a statement it said: "We deeply regret the
circumstances that led to the recall. We have launched an internal
review to give us an unvarnished report on what happened. We will
hold ourselves accountable and improve our processes so our
customers do not experience this again."
Courts are often reluctant to undo settlements, which are the main
means of resolving personal-injury and wrongful-death cases, said
Frank Vandall, a professor at Emory University School of Law and a
product-liability expert.
Each settlement would have to be challenged individually, since the
deals depended on the laws of the state where the settlement was
reached, the facts of the case and the terms of the individual
agreement.
With a sophisticated litigant like GM at the table, it's likely any
agreement would be "very well-drafted and difficult" to break,
Vandall said. Breaking a settlement also may mean that the family
has to return any money they received, depending on the terms of the
original agreement.
But if it emerges that GM continued to sell cars with the faulty
ignition switch despite having evidence that it was a hazard, and
intentionally misled opposing lawyers or omitted critical
information, "judges might well set aside the settlement," Vandall
said.
Attorney Bob Hilliard, who is representing the family of Hasaya
Chansuthus, who was killed in the 2009 crash of a 2006 Cobalt, said
he believes the family has a case for fraud because GM hid the
ignition switch issue. The family settled with GM in early 2011 and
now they intend to overturn the deal and sue, he said.
"If GM conceals negligent facts...and they use that to pressure a
settlement for pennies, while at the same time preventing any
reasonable plaintiffs' lawyer from discovering that the Cobalt had a
death-causing defect, then that's fraud," said Hilliard in an
interview. "The law abhors fraud."
Another obstacle facing plaintiffs who seek to sue GM is that the
automaker is not responsible under the terms of its bankruptcy exit
for legal claims relating to incidents that took place before July
2009. Those claims must be brought against what remains of the "old"
or pre-bankruptcy GM, legal analysts say.
To get around this difficulty, plaintiffs may attempt to argue that
they should be allowed to sue the "new" GM over pre-bankruptcy
actions. In doing so, they could invoke the theory of "successor
liability," meaning that the new GM should be held accountable for
claims against the former company because they believe GM committed
fraud, legal experts say.
[to top of second column] |
FIRST DOCUMENTED DEATH
The adoptive parents of Amber Rose, who died at the age of 16 when
the airbags failed to deploy as she crashed her 2005 Chevrolet
Cobalt into a tree in Dentsville, Maryland in July 2005, say they
are planning to try to overturn a settlement and sue GM. They
reached an agreement with the automaker in February 2006 over what
has become the first documented death linked to the faulty ignition
switches.
Both Jim Rose and his former wife, Terry DiBattista, say they were
never informed about the potentially defective ignition switches. GM
had flagged problems with the switch to Chevrolet dealers in a
service bulletin in February 2005, five months before Amber's fatal
crash.
But the GM lawyer who dealt with the Rose case did not mention the
switch, presenting the settlement offer as "a courtesy" to her
family, DiBattista said.
"I just found out three weeks ago about the ignition switch" that in
some cases could shut the engine and airbags off in the Cobalt and
other GM small cars, DiBattista told Reuters.
Amber's birth mother, Laura Christian, is friends with DiBattista.
The pair are traveling together with parents of other crash victims
to Washington, DC, where lawmakers are holding hearings on the GM
recall next week.
Christian said she is also planning to sue the automaker, even
though she didn't seek a settlement after her daughter's death.
Christian said she first contacted GM in September 2005, seeking to
find out why the airbags did not deploy, "but nobody would ever
speak to me."
If the families go ahead with the lawsuits it would add to mounting
litigation and a public relations crisis at the company, which faces
congressional investigations, a criminal probe by the Department of
Justice, an investigation by the National Highway Traffic Safety
Administration, and an internal probe of its own.
Attorneys in several states have filed class action suits against
GM, which also faces at least two wrongful-death suits from the
families of crash victims who have not settled. Lawsuits in
California and Alabama allege that GM knew of ignition-switch
problems as early as 2001, but failed to take proper steps to fix
the defects.
It's unclear how many out-of-court settlements GM may have reached
with families over accidents now linked to the faulty ignition.
Reuters learned of at least three such settlements, which are
subject to certain confidentiality agreements. GM declined to
comment.
In addition to the two families who settled and are now considering
suing, the family of Brooke Melton, who was killed in a 2010
accident involving a 2005 Cobalt, also reached a settlement but
currently is not planning to sue, according to the family's attorney
Lance Cooper.
(Editing by Martin Howell and Peter Henderson)
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