NJ Gets $4.1M Slice of $120M GM Ignition Switch Settlement
New Jersey is to receive $4.1 million of a $120 million multistate settlement with General Motors to resolve allegations that the company failed to disclose an ignition switch defect that could have caused engines to suddenly shut off during normal operations.
October 19, 2017 at 03:18 PM
3 minute read
New Jersey is to receive $4.1 million of a $120 million multistate settlement with General Motors to resolve allegations that the company failed to disclose an ignition switch defect that could have caused engines to suddenly shut off during normal operations.
New Jersey Attorney General Christopher Porrino in an Oct. 19 statement said the “deadly” defect could have affected “millions” of GM-made cars.
The overall $120 million settlement—involving 48 states and the District of Columbia—concludes a multijurisdictional investigation into GM's conduct in connection with millions of vehicles equipped with the ignition switch, which could render power brakes, steering, air bags and other key functions inoperative upon failing, according to the statement.
Neighboring states are to receive comparable amounts, according to separate releases from those states' attorneys general: Pennsylvania, $4.7 million; New York, $4.33 million; and Connecticut, $3.2 million.
“General Motors' conduct here was unconscionable. It put profit ahead of integrity and, more disturbingly, sat on its corporate hands as unwitting drivers and their passengers traveled throughout New Jersey—and throughout our nation—in GM vehicles that had the potential to fail and become uncontrollable at highway speeds,” Porrino said in the statement.
GM did not immediately respond to a request for comment.
In 2014, GM issued seven vehicle recalls in response to unintended key-rotation-related and/or ignition-switch-related issues, which affected more than 9 million vehicles in the United States. The recalls involved a defective ignition switch that, under certain conditions, could move out of the “run” position to the “accessory” or “off” position. If a collision occurred while the ignition switch was in the “accessory” or “off” position, the vehicle's safety airbags might also fail to deploy. The recalls warned of systems shutdowns, the statement said.
New Jersey and the other states alleged that certain GM employees knew as early as 2004 that the ignition switch posed a safety defect based on the airbag issue. However, the statement adds, despite this knowledge, GM personnel decided it was not a safety concern and delayed making recalls.
The states also alleged that GM continued to promote the reliability and safety of its motor vehicles equipped with the defective ignition switch; that these actions were unfair and deceptive; and that the automaker's actions violated state consumer protection laws, including the New Jersey Consumer Fraud Act.
New Jersey was part of the multistate Executive Committee that negotiated the settlement. In addition to the monetary terms, the multistate agreement with GM contains a variety of injunctive relief terms. GM has agreed to:
- Not represent that a motor vehicle is “safe” unless it has complied with the Federal Motor Vehicle Safety Standards applicable to the motor vehicle at issue.
- Not represent that certified pre-owned vehicles advertised by GM are safe, have been repaired for safety issues, or have been subject to rigorous inspection, unless such vehicles are not affected by 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 United States and included in a recall is eligible for certification and, if there is a recall on any certified pre-owned vehicle sold in the United States, the required repair must be completed before the vehicle is delivered to the customer.
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