Pre-Bankruptcy GM Might Lose Lawsuit Shield

Jason Siu
by Jason Siu

General Motors may no longer be protected against lawsuits predating its 2009 bankruptcy filing and subsequent financial restructuring.

The reversal by bankruptcy judge Robert Gerber could be the latest result from the massive ignition switch recall. Six years ago, a bankruptcy judge specified that General Motors wouldn’t be subject to lawsuits over vehicles made before its government bailout, creating the “old GM” protection from post-bailout GM. Now Gerber – the same judge that declared GM’s invulnerability – is expressing doubts, saying that it might allow the American automaker to get away with alleged misconduct with the ignition switch recall.

SEE ALSO: Mary Barra Deposed in Ignition Switch Suits

The latest official death count connected to the ignition switch recall has reached 74 and affected owners who weren’t injured are suing GM, seeking compensation for their vehicles’ loss in value. If Gerber reverses his decision and rules that bankruptcy doesn’t protect GM from claims on cars made before 2009, the automaker could face as much as $10 billion in potential liability.

[Source: Bloomberg]

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Jason Siu
Jason Siu

Jason Siu began his career in automotive journalism in 2003 with Modified Magazine, a property previously held by VerticalScope. As the West Coast Editor, he played a pivotal role while also extending his expertise to Modified Luxury & Exotics and Modified Mustangs. Beyond his editorial work, Jason authored two notable Cartech books. His tenure at AutoGuide.com saw him immersed in the daily news cycle, yet his passion for hands-on evaluation led him to focus on testing and product reviews, offering well-rounded recommendations to AutoGuide readers. Currently, as the Content Director for VerticalScope, Jason spearheads the content strategy for an array of online publications, a role that has him at the helm of ensuring quality and consistency across the board.

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