U.S. judge dismisses GM ignition switch criminal case

[September 20, 2018]  By David Shepardson

WASHINGTON (Reuters) - A federal judge in New York on Wednesday dismissed a criminal case brought against General Motors Co in 2015 over the largest U.S. automaker's handling of an ignition-switch defect linked to 124 deaths.

U.S. District Judge Alison Nathan approved a request filed Monday by federal prosecutors to dismiss the two-count criminal information.

In 2015, GM entered into a deferred prosecution agreement with the U.S. Attorney's Office in New York after the Detroit automaker was charged with concealing information from government officials, and wire fraud. GM agreed to pay a $900 million fine and accept three years of oversight by an independent monitor.

Federal prosecutors in New York told Nathan in a letter Monday that GM had complied with the terms of the agreement.

GM has paid more than $2.6 billion in penalties and settlements, including the fine, over faulty ignition switches that could cause engines to stall and prevent airbags from deploying in crashes. The defect was linked to 124 deaths and 275 injuries, and prompted a recall that began in February 2014 of 2.6 million vehicles.

GM spokesman David Caldwell said in an emailed statement on Wednesday the government had finished monitoring the company.

GM has made substantial safety improvements over the last few years and added a new product safety structure, Caldwell added.

No individuals were criminally charged, but Chief Executive Mary Barra fired 15 people, including eight executives, over the issue. Barra said last year the ignition recall was "a moment in time where the company committed deeply to safety."

General Motors Co. headquarters is seen in Detroit, Michigan, September 17, 2015. REUTERS/Rebecca Cook

Federal officials said in 2015 that GM concealed the deadly defect and could have significantly reduced the risk by improving its key design for less than $1 dollar per vehicle.

In October 2017, GM agreed to pay $120 million to resolve ignition switch claims from 49 states. The states said GM knew as early as 2004 that the ignition switch posed a safety defect because it could cause airbag non-deployment, but company officials decided it was not a safety concern and delayed recalls.

The issue prompted an industrywide jump in recalls in 2014 to an all-time high and cast a spotlight on GM's safety record as Barra testified before the U.S. Congress.

GM still faces some pending civil lawsuits over the ignition switch issue, including some economic loss claims.

(Reporting by David Shepardson; Editing by Richard Chang)

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