A ruling handed down by a New York federal judge may open General Motors to punitive damages in addition to actual damages incurred by people in California and elsewhere whose vehicles' ignition switches proved to be faulty, costing the lives of at least 169 persons. The judge's argument is based on a presumption that after GM declared bankruptcy and emerged into the marketplace again, GM staff and their accompanying knowledge joined the new company that was formed.
The judge explicitly stated that if plaintiffs can show that employees of the new iteration of GM were aware of the issues with the ignition switches, which the company had repeatedly denied until issuing a mass recall in 2014, punitive damages would be available in addition to direct costs and losses stemming from the defective switches. The switches, which abruptly turned off while driving, caused catastrophic air bag, power steering and brake failures.
In a previous ruling, the judge had stated that "New GM" was shielded from lawsuits stemming from crashes that occurred prior to the completion of the bankruptcy proceedings, but left the question of possible punitive damages pending. At least 250 pending personal injury lawsuits nationwide may be affected by the new ruling, opening GM to jury-awarded damages in the billions of dollars. If plaintiffs can demonstrate conclusively that the "new" company was aware of the faulty switches and hence liability, hundreds of injury cases may be affected.
Litigation based on harm caused by dangerous products often depend upon whether the manufacturer or distributor was aware of the defects but did not disclose them in a timely fashion. A person who has been injured by a defective motor vehicle part may want to have the assistance of an attorney in seeking compensation for the losses that have been sustained.