GM Fined $35 Million for Major Safety Issues

GM is belatedly recalling millions of cars because of safety defects that have already led to 13 deaths.

The beleaguered automaker is under attack from all sides not for manufacturing defective vehicles – every manufacturer has had some safety issues – but for actively concealing known safety defects and dragging its feet in addressing safety problems. When a defect that could cause a loss of life is unearthed in a healthy company action is taken to fix the problem. At GM the response was the opposite. Employees hid the truth. Employees were coached on what kind of language to use and not to use when discussing safety-related flaws. Transportation Secretary Anthony Foxx flat out said “What GM did was break the law.”

The $35 million fine is the largest ever imposed on a carmaker, and it’s the largest allowable by law – but many are saying it’s not nearly enough. Given that recall-related expenses are expected to cost the automaker over $700 million, $35 million is not nearly enough to make any kind of impression on GM. Senator Edward Markey (D-MA) said, “A penalty of $35 million is a parking ticket in comparison to the toll this defect has taken on the lives of America’s families.” There is a bill before Congress to increase the maximum fine to $300 million.

Things could, however, still get a lot more expensive for GM. They could still be subject to further fines from a criminal investigation by the Justice Department. When Toyota was found guilty of concealing safety defects the company paid a $1.2 billion settlement – which is more in the range of what would be “serious money” for a company as big as GM.

The company knew since at least 2009 that faulty ignition switches could cause airbags to turn off, yet the company did nothing about it until this year. The recall eventually involved 2.6 million vehicles.

That was back in February, 2014. GM has recently been dealt another blow, again one involving ignition switches, this time affecting 3.3 million vehicles. If the car key has any weight on it – such as key holders or other keys – and hits a pothole, the car could stall. And just at that vulnerable moment – when the car’s engine quits – the airbags also quit working. So the defect can both cause an accident, and lead to disabling one of the car’s most important safety features, just when an accident is most likely.

The defect from the first recall has resulted in 54 accidents and 13 deaths – no doubt GM will also be facing substantial legal costs from those unnecessary deaths.

If you or a loved one has been injured as a result of a defective car or truck, from GM or any other manufacturer, contact an experienced personal injury lawyer at the New Jersey Law Offices of Jeffrey S. Hasson, P.C. for help.