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NHTSA Presents Questions to GM Over Ignition Switch Recall

The CBS Evening News led its nightly broadcast by reporting that “the government is demanding answers” related to GM’s ignition switch recall affecting 1.6 million vehicles. Correspondent Jeff Glor details the NHTSA order containing “107 questions in all, including exactly how many consumer complaints has GM received? How many lawsuits has GM settled and the details of each.” The report notes the April 3 deadline for a GM response and gives the background on the ignition switch problem itself. Glor also referenced the potential $35 million fine, which Massachusetts Sen. Ed Markey (D) described as “just a parking ticket” relative to the public danger involved and the company’s profits. Anchor Scott Pelley ends the report by commenting that it was “worth noting that GM volunteered to recall the cars itself.”

The New York Times reports that the NHTSA question list “underscores the significant gaps in the chronology of events that the automaker turned over to the safety agency last month.” Notably, the article suggests that NHTSA’s move “also shows how slow the agency has been to respond to the deadly ignition problem.” The article describes how heavy key rings could move the ignition switch to the accessory mode, potentially disabling the car’s engine and electrical system. The article also points out that GM only expanded the February 13 recall last week to include over 800,000 more vehicles. Former NHTSA attorney Alan Kram is quoted as describing the order as “the most detailed special order that I ever recall seeing.” NHTSA’s probe is characterized as focusing on instances in which engineers and mechanics had proposed fixes to the ignition problem, but no recall was ordered. The article also compares the order to one given to Toyota in 2010, which ultimately resulted in maximum fines related to unintended acceleration issues.

The Detroit Bureau reports that the heat on GM “just got turned up today by the National Highway Traffic Safety Administration.” The article likewise groups the 107 questions as probing “what [GM] knew, who knew, when they knew it and why they didn’t act sooner.” The article notes that the ignition switch defect, which GM initially discovered in 2004, has been “linked to 31 crashes and 13 deaths.” GM already has settled one lawsuit stemming from the issue, while the recall is reported as affecting “the 2005-07 Chevrolet Cobalt, 2007 Pontiac G5, 2003-07 Saturn Ion, 2006-07 Chevrolet HHR, 2006-07 Pontiac Solstice and Saturn Sky.”

The AP reports that NHTSA is asking GM to respond with “pictures, memos, electronic communications, engineering drawings and other data to answer 107 questions” under oath. The article notes that GM would have been required to notify NHTSA of the issue within five days of discovery and that the $35 million fine could be levied in either the case of withheld evidence or delayed response. The article also frames the incident in the context of GM’s emergence from 2009 bankruptcy, saying that GM’s “admission that recall procedures were lacking 10 years ago shows how the old culture can still haunt the automaker.”

Automotive News quotes a NHTSA statement saying, “We are a data-driven organization, and we will take whatever action is appropriate based on where our findings lead us.” The article notes that the investigation will also ask for “data on each complaint, including the date on which GM received each report” as well as why GM was unaware until 2013 that the ignition switch had been redesigned by Delphi Mechatronics in 2006.

The Detroit News attributes the 27-page letter to NHTSA General Counsel O. Kevin Vincent and reports that the probe follows from last week’s opening of “a formal investigation into the timeliness of GM’s recall.” The article also quotes one of the questions as specifically wanting to know if GM performed “any work in 2008 (relating) to the defect that is the subject of this recall.” The article notes the in-house GM investigation into the matter, being conducted by a “working group of senior executives,” led by CEO Mary Barra.

Reuters reports that a team of lawyers was already interviewing employees on Wednesday to get a sense of how the company handled its 2004 discovery of the ignition flaw. The article adds that replacement parts for the expanded recall will be made available in April but that there were not any cost estimates available on the recall itself, though the article predicts a flurry of subsequent litigation.

Bloomberg News reports that “GM has now linked the defect to at least 23 crashes, including 13 deaths.” The NHTSA order is quoted as saying that “falsifying or withholding information in response to this special order may also lead to criminal penalties of a fine or imprisonment of up to 15 years, or both.” The article also points out that NHTSA “didn’t start a defect investigation” after being notified by a research team of the potential flaw in 2007.

USA Today quotes one attorney involved in a previous lawsuit over the ignition switch defect as saying that “it appears that the government is taking an aggressive approach, which is the right way.” The article refers to earlier explanations from GM that the cars were still safe to drive because they could be steered and stopped in spite of an ignition switch failure.

NYTimes analysis concludes NHTSA declined to investigate GM ignition-switch defect.

In a report of almost 2,000 words, the New York Times shows an unfavorable portrayal of NHTSA, reporting that “regulators received more than 260 complaints over the last 11 years about General Motors vehicles that suddenly turned off while being driven, but they declined to investigate the problem, which G.M. now says is linked to 13 deaths and requires the recall of more than 1.6 million cars worldwide.” Based on the NYTimes’ own analysis of complaints submitted to NHTSA, the report claims the “failure to recognize a pattern in individual complaints has been a problem for the safety agency before.” Former administrator Joan Claybrook says similarly that “the ability to spot trends is a huge issue, and N.H.T.S.A. has not got it under control by any means.” The report also turns to NHTSA Director of the Office of Defects Investigation Frank Borris, who points out that the agency bases its decisions off of “really well-seasoned automotive engineers who leverage a lot of technology and lean on past precedent about when to open, when to close, and when to push for a recall,” adding, “it’s no magic formula.”

Newsmax reports that the NYTimes also quoted NHTSA Chief Counsel Kevin Vincent, who claims that consumer complaints have to submit before the question of what constitutes an “unreasonable risk to safety.” According to Vincent, “that term ‘reasonable’ is a legal term, which is very elastic and means a lot of different things in a lot of different contexts. Each case is a different fact problem.”

GM under Federal probes over handling of ignition switch defects.

News that Federal authorities have opened criminal investigations of General Motors for the auto-maker’s handling of an ignition switch problem that is linked to at least 12 deaths continues to generate significant news coverage, with four minutes devoted to the story on two network newscasts last night.

The CBS Evening News reported that the FBI and Federal prosecutors have launched criminal probes, with one possible issue being whether GM violated a Federal law requiring car makers “to give the Federal government timely notice of defects.” CBS (Glor) reported that GM “knew about a problem with ignition switches in Cobalts and other compact cars in 2004,” and in 2005 GM “issued this service bulletin to its dealers, warning of ignition switches that could turn off or accessory position if there’s a heavy key ring of the key is bumped – engines shut off and air bags don’t work.” The National Highway Traffic Safety Administration “had access to that information in 2005,” but GM issued no recalls until 2014.

ABC World News reported that GM “is now recalling 1.6 million cars. Models from 2003, to 2007, including the Chevy Cobalt, Pontiac Solstice and Saturn Ion. In those recalled models, the problem with the ignition, which could turn off unexpectantly, shutting down both the car and its safety systems, including the air bag.” GM “says a heavy key chain or even rough roads can cause the problem.”

The Washington Post reports that GM “is the target of multiple federal inquiries,” and notes that lawmakers “in both the House and Senate have announced plans to summon GM officials to Capitol Hill for hearings, and a potential criminal investigation is underway at the Justice Department.” The New York US Attorney’s office “has launched a preliminary inquiry to determine whether GM knowingly rolled out cars with a faulty ignition switch that stalled their engines and disabled their air bags, according to a person briefed on the inquiry.” GM “could be found criminally liable if the company knew about the problem, did not fix it and failed to notify federal regulators.”

The New York Times reports that GM “says none of the 12 deadly accidents associated with the recalled vehicles occurred after December 2009, but the automaker has consistently declined to offer evidence to back up the claim,” and in documents released on Tuesday, “it lowered the number from 13, saying it had mistakenly counted one fatality twice. In a statement on Wednesday, G.M. said: ‘The investigation of the ignition switch recall and the impact of the defective switch is ongoing. We will be better situated to accurately answer questions and provide additional information at the conclusion of the investigation.’”

The AP reports that GM “is offering free loaner cars and $500 toward a new GM vehicle to more than a million owners of compact cars that are being recalled for a deadly ignition switch defect,” but “the owners have to ask in order to get the benefits.” The offers, “disclosed in a document posted Wednesday on the National Highway Traffic Safety Administration’s website, are effective immediately.” Owners of recalled GM cars “will be able to use the loaner cars until parts arrive at dealerships to replace the faulty switches,” which is expected to be around April 7, according to the auto maker.

Bloomberg News reports that David Friedman, acting administrator for NHTSA, said that “If we had that information, if GM had provided us with timely information, we would have been able to take a different course with this.” He said that with the data they had, the agency “didn’t think that was sufficient to open up a formal investigation.” Bloomberg reports that the NTHSA had looked into the problems with the Chevrolet Cobalt’s airbags in 2006.

The Detroit (MI) News reports that Transportation Secretary Anthony Foxx said that the Justice Department is “looking at the same information we’re looking at and they will make that determination.” The News also reports that Foxx said that the NHTSA has “outstanding questions to GM,” but says “we can’t prejudge the outcome.” He encouraged GM owners to follow GM’s instructions to only use the ignition key when operating a recalled vehicle.

The Detroit (MI) Free Press reports that Senator Claire McCaskill (D-MO) said that “We also need to make sure that General Motors and federal regulators are doing everything they can to prevent more tragedies like this now and in the future.”

Legal battles ahead for GM. The New York (NY) Times reports on the legal challenges that will be made to GM’s liability regarding its 2009 bankruptcy filing. The Times suggests that lawyers may “challenge the validity of the restructuring agreement credited with saving the automaker from dissolution…If mounted and successful, the challenges could send G.M. back into federal bankruptcy court.” The Times argues that lawyers will attempt to invoke “successor liability” on the new GM. A bankruptcy specialist at the law firm Jordan, Hyden, Womble, Culbreth & Holzer, said that “The ability to impose successor liability on the new G.M. is the avenue that this litigation is going to go through.”

A separate New York (NY) Times article reports on crashes that may have involved the faulty ignition switches, but due to investigations conducted either haphazardly or prior to any information on the problem, may never have the cause conclusively determined.

GM urged to waive bankruptcy immunity for recall lawsuits. USA Today reports that automobile safety advocates are urging GM “to waive its post-bankruptcy immunity to legal claims connected to an ignition switch defect that has led to the recall of 1.6 million vehicles.” USA notes that as “a condition of the taxpayer-financed, government-supervised bankruptcy restructuring of GM in 2009, the automaker was given immunity from product liability or wrongful death claims arising from accidents that occurred before it exited bankruptcy on July 10, 2009.” Clarence Ditlow, “who runs the Center for Auto Safety, and John Claybrook, a former head of the National Highway Traffic Safety Administration, signed a letter to GM CEO Mary Barra” on Wednesday “that also asked GM to set up a $1 billion fund ‘to cover losses of victims and families of safety defects whose claims have been extinguished by the bankruptcy or barred by statues of repose or limitations.’”

From the American Association for Justice news release.

Bob Kraft

I am a Dallas, Texas lawyer who has had the privilege of helping thousands of clients since 1971 in the areas of Personal Injury law and Social Security Disability.

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The title of this blog reflects my attitude toward those government agencies and insurance companies that routinely mistreat injured or disabled people. As a Dallas, Texas lawyer, I've spent more than 45 years trying to help those poor folk, and I have been frustrated daily by the actions of the people on the other side of their claims. (Sorry if I offended you...)

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