2007 Saturn Ion ad GM recall lawsuit.jpg
A lawsuit targeting GM over faulty ignition switches claims this advertisement for a 2007 Saturn Ion shows that the automaker continued to tout its vehicles as safe even though it knew of the ignition problems that are believed to have played a role in more than 300 fatalities.
(Flint US District Court)
FLINT, MI -- Two Michigan attorneys are seeking to have their Flint-area federal lawsuits certified as class actions in General Motors' ignition switch recall. But a legal expert says the cases could have difficulty succeeding.
Each suit seeks more than $5 million in total compensation, but they do not specify what each person joining the suits would get.
Two lawsuits have been filed in Flint U.S. District Court alleging that GM purposely covered up problems with ignition switches for more than a decade and that the alleged coverup tricked customers into purchasing vehicles that the company advertised as safe.
Dearborn-based attorney Kassem M. Dakhlallah filed a lawsuit in March on behalf of Wayne County resident Adnan Jawad, who owns a 2007 Chevrolet Cobalt. He said he thinks all class action suits against GM could total more than $1 billion in damages.
Jawad's Cobalt is one of roughly 2.6 million vehicles nationwide that were recalled by GM beginning Feb. 7 for problems with the ignition switch that could cause sudden engine power loss and non-deployment of airbags in a collision.
The lawsuit points to a widely quoted study commissioned by the Center for Auto Safety claims faulty ignition switches played a role in more than 300 fatalities. GM says it knows of 13 fatalities in crashes linked to the switches.
Six GM vehicles produced from 2003 through 2011 are included in the recalls, the lawsuit claims.
Dakhlallah argues that GM first became aware of the problem with the ignition switches in 2001 during the vehicle design phase, but the company moved ahead with production despite the issue.
However, rather than changing to a more expensive, yet improved, ignition switch that the company had already designed, Dakhlallah said GM continued to use a cheaper, defective part in order to save money.
The lawsuit contends that GM covered up the problem and continued to manufacture and sell the defective vehicles -- advertising them as safe and reliable -- even after knowing that people had been injured and died as a result of the problems with the ignition switches.
"They knew it was a bad product," Dakhlallah said.
Dakhlallah's lawsuit does not include any owners who were physically injured or killed due to defects in the vehicles and is limited to those who suffered economic damages. Dakhlallah said cases involving injuries and death would likely be tried individually, outside of the class-action process.
A second lawsuit was filed in March in Flint U.S. District Court on behalf of Tennessee resident Peggy Sue Jones by Rochester-based attorney E. Powell Miller. The case echoes Dakhlallah's accusations.
Miller could not be reached for comment.
Miller's lawsuit claims that owners of the recalled vehicles will receive less money when they sell or trade-in their cars, and that a GM coverup caused them to pay more for the vehicles than they otherwise would have had they known the truth.
Cooley Law School professor and Flint-native Mark Dotson said the cases could be difficult for the attorneys to win.
"Just because you sell a product does not mean it's free from defect," Dotson said.
GM filed a motion in New York Bankruptcy Court Monday, April 21, asking whether the lawsuits alleging economic damages resulting from the ignition switches could proceed. The motion does not include any cases that involve loss of life, injury or property damage.
The Detroit automaker emerged from bankruptcy in July 2009 and contends that the liabilities associated with the lawsuits were left with the old General Motors Inc. The company contends the recalled cars were made and sold by the old company.
"General Motors has taken responsibility for its actions and will keep doing so," the company said in a statement following the filing of the motion. "GM has also acknowledged that it has civic and legal obligations relating to injuries that may relate to recalled vehicles, and it has retained Kenneth Feinberg to advise the company what options may be available to deal with those obligations."
Feinberg -- who handled funds for the victims of the Sept. 11, 2001, terrorist attacks, the Boston Marathon bombing and the BP oil spill -- was brought on to explore ways to compensate injured victims.
"I don't think it's going to succeed," Dakhlallah said of GM's motion to shield it from the economic-based legal claims.
Dakhlallah said evidence in the case shows that GM committed fraud by not disclosing the liability associated with the ignition switch when going through bankruptcy and that should force them to face the lawsuits now. He also added that some of the vehicles included in the recall were produced after GM emerged from bankruptcy.
"Fraud is the exception to every rule," Dakhlallah said.
But, Dotson said proving fraud could be an uphill battle and require the attorneys to prove that GM purposely covered up the problem.
"Fraud requires evidence that they lied," Dotson said.
Even if the bankruptcy judge allows the cases to move forward, Dotson said the attorneys could have difficulty getting a federal judge to certify a class of plaintiffs for a class-action lawsuit.
Dotson said the amount and scope of those included in the class action could make it difficult for the attorneys to prove that each member of the class have related claims.
Both lawsuits filed by Dakhlallah and Miller point to advertisements portraying the recalled vehicles as safe, despite GM's alleged knowledge of the ignition flaw.
Dakhlallah said the Flint cases and the roughly 50 similar cases nationwide will move to the federal Judicial Panel on Multidistrict Litigation for a May 29 hearing in Chicago.
The panel will decide whether the cases should be consolidated into one case and, if so, determine which federal district court should hear the case.
Dakhlallah said he plans to attend the hearing and that he will argue the cases should be heard in Flint U.S. District Court by Judge Mark A. Goldsmith.
GM has not yet responded to the Flint lawsuits. Attorney Lawrence J. Murphy, who is representing GM in both cases, could not be reached for comment.
Information from the Associated Press is included in this report.