A company that files for bankruptcy, like General Motors did in 2009, can only be required to pay for pre-bankruptcy claims in exceptional circumstances, like when there is evidence of fraud, misrepresentation, or criminal activity.
Goldsboro, NC (PRWEB) April 18, 2014
North Carolina auto accident firm Riddle & Brantley, LLP continues to investigate reports of injury and wrongful death claims related to General Motor’s February vehicle recalls as new allegations from the National Highway Traffic Safety Administration and the Center for Auto Safety emerge.(1) Both organizations are now questioning why GM decided in 2001 to reject an improved ignition switch in favor of a cheaper, but less reliable component.
A Bloomberg report published April 16 concerned a letter to General Motors’ CEO Mary Barra from Joan Claybrook, former head of the NHTSA and Clarence Ditlow, Executive Director of the Center for Auto Safety. According to the report, Claybrook and Ditlow confronted the automaker about evidence that GM chose to use the cheaper part in its 2003 Chevrolet Cobalts rather than a component that was more effective, but slightly costlier. The faulty ignition switch design may have led to 13 deaths and dozens more injuries.
A report from Reuters released the same day observed that GM has filed several motions in various defective ignition switch lawsuits. These motions request that the litigation be stayed, or stalled, until a federal bankruptcy judge has ruled on the issue of whether or not General Motors’ 2009 bankruptcy case prohibits the lawsuits.
"During a bankruptcy case, all of a debtor’s debts and liabilities are discharged—whatever the debtor owed to anyone else is wiped out. A company that files for bankruptcy, like General Motors did in 2009, can only be required to pay for pre-bankruptcy claims in exceptional circumstances, like when there is evidence of fraud, misrepresentation, or criminal activity,” said attorney Gene Riddle, founding member of Riddle & Brantley, LLP. “Many plaintiffs’ attorneys are hoping that a bankruptcy judge will find that GM meets this exception, and will allow General Motors to be sued for discharged liabilities."
Riddle & Brantley’s attorneys are now extending free legal consultations to any person who was injured in one of GM’s recalled vehicles.
The firm created a timeline of important events to help consumer stay informed about breaking news throughout the recalls. This timeline also highlights important developments in the federal investigation of GM, as well as the progress of important aspects of the case, such as GM’s ongoing internal investigation and proposed victims’ compensation strategy.(2)
For a detailed summary of the GM recall, consumers can visit Riddle & Brantley’s timeline of events here. Anyone who wants to report an injury or wrongful death associated with a defective GM vehicle can contact the firm through its website or by calling 1 (800) 525-7111.
About Riddle & Brantley, LLP
The attorneys at Riddle & Brantley, LLP use their combined 180 years of legal experience to fight for those who have been injured by the actions or negligence of another person or entity. The Goldsboro, North Carolina-based personal injury law firm handles all types of personal injury claims including auto accident injuries, dangerous drug litigation, medical malpractice, product liability claims, premises liability and workers’ compensation. For a free and confidential case evaluation, contact Riddle & Brantley by visiting justicecounts.com or by calling (800) 525-7111 today.
Riddle & Brantley, LLP
601 North Spence Ave.
P.O. Box 11050
Goldsboro, NC 27532
1. “GM Vetoed Better Ignition Part to Save Money, Advocates Say”, April 16, 2014, http://www.businessweek.com/news/2014-04-16/gm-said-to-reject-better-ignition-part-in-2001-to-save-money
2. “Senator: GM Engineer Lied over Deadly Ignition Switch,” April 2, 2014, http://www.usatoday.com/story/money/cars/2014/04/02/barra-gm-recall-senate/7195135/