AG Jeff Landry
Reaches Settlement with GM Over Defective Ignition Switch
BATON ROUGE, LA - Louisiana Attorney General
Jeff Landry today announced a $120 million settlement with
General Motors Company (GM) over allegations GM concealed safety issues
related to ignition-switch-related defects in GM vehicles.
The settlement, reached between the attorneys general of
49 states and the District of Columbia and GM, concludes a multistate
investigation into the auto manufacturer’s failure to timely disclose known
safety defects associated with unintended key-rotation-related and/or
ignition-switch-related issues in several models and model years of GM
vehicles.
“My Public Protection Division works tirelessly to hold
accountable companies that engage in unfair and deceptive trade practices,”
said General Landry. “We will continue our efforts to protect Louisiana's
consumers.”
In 2014, GM issued seven vehicle recalls in
response to unintended key-rotation-related and/or ignition-switch-related
issues, which have affected over 9 million vehicles in the U.S. The
recalls involved a defective ignition switch which, under certain
conditions, could move out of the “Run” position to the “Accessory” or “Off”
position. If this occurs, the driver experiences a loss of electrical systems,
including power steering and power brakes. If a collision occurs while
the ignition switch is in the “Accessory” or “Off” position, the vehicle’s
safety airbags may also fail to deploy, increasing the risk of serious
injury or death in certain types of crashes in which the airbag was otherwise
designed to deploy.
As the states alleged, certain employees of GM and
General Motors Corporation (which went through bankruptcy in 2009), knew
as early as 2004 that the ignition switch posed a safety defect because it
could cause airbag non-deployment. However, despite this knowledge, GM
personnel decided it wasn’t a safety concern and delayed making
recalls. GM continued to market the reliability and safety of its motor vehicles
which were equipped with this defective ignition switch.
The states alleged that these actions were unfair and
deceptive and that the automaker’s actions violated state consumer protection
laws.
Under a consent judgment, GM shall:
- Not represent that a motor vehicle is “safe”
unless they have complied with the Federal Motor Vehicle Safety standards
applicable to the motor vehicle at issue.
- Not represent that certified pre-owned
vehicles that GM advertises are safe, have been repaired for safety
issues, or have been subject to rigorous inspection, unless such vehicles
are not subject to any open recalls relating to safety or have been
repaired pursuant to such a recall.
- Instruct its dealers that all applicable
recall repairs must be completed before any GM motor vehicle sold in the
U.S. and included in a recall is eligible for certification and, if
there is a recall on any certified pre-owned vehicle sold in the U.S., the
required repair must be completed before the vehicle is delivered to a
customer.
GM also agreed to
pay the participating attorneys general a total of $120 Million, of which
Louisiana’s share is $1,759,167.93.
In addition to Louisiana, the multistate group – led
by Ohio, South Carolina, Connecticut, Florida, Maryland, Michigan,
New Jersey, Pennsylvania, and Texas - includes:
Alabama, Alaska, Arkansas, California, Colorado, Delaware,
District of Columbia, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa,
Kansas, Kentucky, Maine, Massachusetts, Minnesota,
Mississippi, Missouri, Montana, Nebraska, Nevada, New
Hampshire, New Mexico, New York, North Carolina, North
Dakota, Oklahoma, Oregon, Rhode Island, South
Dakota, Tennessee, Utah, Vermont, Virginia, Washington, West
Virginia, Wisconsin and Wyoming.