As the investigation into GM’s knowledge of the ignition switch defect that has been linked to several accidents moves forward, some settlements that GM made with families of those killed may be reopened. Illinois residents and those around the country have most likely been keeping an eye on this ongoing national story, which continues to grab headlines.
Because GM settled some cases without disclosing their knowledge of the defects, courts may be willing to let those settlements be undone and allow those families to join in new suits being filed against the manufacturer for these dangerous products.
Generally a settlement cannot be undone. But if the families can prove that GM committed fraud by failing to disclose knowledge they had at the time of a settlement, waived judge may approve setting the settlement aside. However, proving this fraud is only the first step in this very complicated situation.
If the families can prove that GM fraudulently covered up information about the defect in order to affect a settlement, the settlement could be undone. If the settlement is set aside, the second issue will be to determine which GM entity to sue. The company filed bankruptcy after some of these cases were settled so they may be subject to the bankruptcy terms that settled any legal claims as of the date of the bankruptcy. But reopened claims could be filed against the new GM under the law of successor liability, which would make the post-bankruptcy GM liable for claims against the old GM.
As federal investigations continue into what GM knew and when they knew it, lawsuits are being filed across the country. Many of the facts that evolve in that investigation will be key factors to whether earlier settlements can be reopened.
Getting into an accident or hurt because of a defective product can be a devastating and confusing experience. In order to hold the appropriate parties liable and collect compensation, it may be wise for victims and their families to speak with an attorney to explore their options.
Source: Reuters, “Exclusive: GM crash victims’ families who settled may revisit deals,” Jessica Dye, Julia Edwards and Paul Lienert, March 29, 2014