General Motors Ignition Switch Death Claims Reach 125 As Lawmakers Hit NHTSA Over Recall Failure

At least 125 wrongful death claims have been submitted to General Motors on behalf of individuals who maintain that defective ignition switches contained in certain Chevy, Pontiac and Saturn vehicles caused fatal accidents, and representatives of the auto maker have confirmed that many of the claims will be paid.

General Motors has acknowledged that at least 19 deaths were probably caused by problems in their vehicles earlier this year, and they are continuing to review records in dozens of additional claims submitted to an ignition switch settlement fund established earlier this year. Overall, at least 445 claims have been filed.

The fund is being managed by attorney Kenneth Feinberg, and GM has said it will abide by his decisions on who should be compensated. According to a report by Bloomberg News, Feinberg indicates that it will be another four to six weeks before the process for reviewing claims gets up to speed. By then, the company should have a better idea how much it will expect to pay out overall.

GM set aside $400 to $600 million for the fund, which began accepting claims August 1 and will continue to do so until the end of December.

GM Ignition Switch Recalls

The fund came in the wake of a GM ignition switch recall initiated in February, which has encompassed millions of small cars that contain defects where it may sudden shut off if heavy keychains are used or if the ignition is jolted, such as may occur in a crash. Sudden loss of power may cause drivers to lose control of the vehicle, and it may prevent the airbags from deploying, increasing the risk of severe and life-threatening injury.

Since the recall, it has been discovered that GM officials knew about the defective ignition switch parts for years, but failed to address the issue or warn consumers.

Following an investigation, the National Highway Traffic Safety Administration (NHTSA) fined the automaker $35 million.

Congress Blasts NHTSA For Oversight Failures

The U.S. House Energy and Commerce Committee released a report this week, blasting the NHTSA for dropping the ball on its duties to oversee auto safety prior to the GM ignition switch recall.

The congressional report (PDF) found that the agency had several opportunities to catch the problem and get the vehicles recalled since at least 2007, but failed to act.

“Our investigation helped expose a long list of failures by GM that led to this colossal safety breakdown. But our work also revealed that some of the same pervasive problems within the company also plagued its regulator,” Rep. Tim Murphy (R-PA), chairman of the Oversight and Investigations Subcommittee, said. “NHTSA too suffered from a lack of accountability, poor information sharing, and a fundamental misunderstanding of the vehicles, all of which contributed to the failure to identify and fix this deadly defect. Both GM and NHTSA had a responsibility to act, and both share culpability in this safety failure. While NHTSA now complains about GM’s switch, it seems NHTSA was asleep at the switch too.”

The report found that the NHTSA failed to act after a state trooper reported the problem between the air bags and the ignition switches, and failed to act after three independent investigations should have set off warning signs.

“The agency’s repeated failure to identify, let alone explore, the potential defect theory related to the ignition switch — even after it was spelled out in a report the agency commissioned — is inexcusable,” the lawmakers concluded. “This was compounded by NHTSA staff’s lack of knowledge and awareness regarding the evolution of vehicle safety systems they regulate. Regulators should not be held to a different standard.”

On the same day the report came out, a senate subcommittee held its own hearing on the NHTSA’s actions and its ability to oversee the auto industry.

“What we have learned so far from the GM recall has shown us we still have serious deficiencies in how both automakers and auto safety regulators tackle the task of insuring the vehicles on the road are as safe as they can be,” Sen. Claire McCaskill (D-MO), chair of Consumer Protection, Product Safety, and Insurance subcommittee, said at the hearing.

McCaskill pointed out that the NHTSA had received more than 2,000 complaints about the ignition switch problems in the recalled vehicles without taking action.

GM Faces Injury and Economic Lawsuits

A growing number of GM ignition switch recall lawsuits have been filed by plaintiffs who suffered injuries in vehicles recalled by the auto maker this year.

In some cases, the injuries and deaths occurred in vehicles that have been recalled for ignition switch problems, but are not covered by the fund. In other cases, the claims are of economic losses from vehicle owners and investors who say that GM’s knowledge of the problem, and its refusal to act, gave a false impression of the value of the vehicles and the company.

In June, the U.S. Judicial Panel on Multidistrict Litigation established coordinated proceedings for all lawsuits filed against General Motors (GM) over the ignition switch problems, centralizing cases filed nationwide before U.S. District Judge Jesse Furman in the Southern District of New York as part of an MDL, or Multi-District Litigation.

At the time the litigation was centralized, fifteen actions pending in six different districts were consolidated to reduce duplicative discovery into common issues in the cases, avoid conflicting rulings from different judges on the same issues and to serve the convenience of witnesses, parties and the courts.

According to an update (PDF) provided by the U.S. JPML on August 15, nearly 100 additional cases were transferred into the MDL during the first two months. However, as GM recall lawyers continue to review and file cases, it is ultimately expected that several thousand lawsuits may eventually be centralized before Judge Furman.