General Motors’ Ignition Probe Focuses on Legal Department
The legal department at General Motors has become the focus of an internal inquiry into the defective switches that triggered a massive GM recall earlier this year, according to a New York Times report. Documents, e-mails and interviews, says the Times, show that high-ranking officials, especially those in the legal department, had “acted with increasing urgency” over the past year to deal with the faulty switches.
Wrongful Death Lawsuit Forced GM to Action
GM’s handling of the ignition recall has spurred two congressional probes, investigations from the Justice Department and SEC, and numerous lawsuits. On Friday, the U.S. Department of Transportation announced it would fine the automaker $35 million for its delayed action. GM has acknowledged that it was aware of issues with the switches for at least a decade but failed to alert owners of the potential dangers.
The turning point, according to the Times, came in September when, without warning, GM agreed to settle a wrongful death lawsuit involving a 2005 Chevy Cobalt. A lawyer for the family of Brooke Melton, Mr. Lance Cooper, had conducted a thorough investigation of the switches and found two different designs with the same part number.
GM engineer Ray DeGiorgio had given a deposition stating that he was unaware of any changes to the switch design. Documents released last month indicated that DeGiorgio had, in fact, been the one to authorize the changes without issuing a new part number.
At the same time, Jim Federico, who was in charge on an internal investigation into the defective switches, was set to give a deposition in the case when GM lawyers suddenly offered to settle the case. The Melton settlement, which the details of are confidential, set in motion what would eventually lead to the recall of 2.6 million compact cars with the deadly ignition switches.
Four Senior GM Executives Gone
Since the ignition switch recall was announced, four senior-level executives have left GM, including Federico. The company has also placed DeGiorgio and engineer Gary Altman on paid leave; another engineer, Brian Stouffer, retired. An internal probe conducted by former U.S. attorney Anton Valukas is expected to conclude over the next few weeks and more personnel changes are anticipated.
In the meantime, lawyers for victims and their families have urged the company to establish a GM compensation fund to aid those injured or killed in crashes involving the vehicles. GM has said it is aware of 13 deaths linked to the switches, but based on claims that number could be much higher. In April, the automaker hired attorney Ken Feinberg to assist GM in its options regarding a GM fund.
AUTOMOBILE ACCIDENT RESULT
$1.8 MillionExpenses: $20,000.00 | Attorneys Fees: $765,000.00 | Net to Client: $1 Million
AUTOMOBILE ACCIDENT RESULTS
$2 MillionExpenses: $78,475.96 | Attorneys Fees: $850,087.96 | Net to Client: $1,071,436.00
AUTOMOBILE ACCIDENT RESULT
$2.3 MillionExpenses: $200,000.00 | Attorneys Fees: $900,000.00 | Net to Client: $1.2 Million