GM Must Face Punitive Damage Possibility: Bankruptcy Judge Rules

CORPUS CHRISTI, TX - November 9, 2015: Bob Hilliard, appointed by the Federal Judge in the GM MDL litigation to be the lead attorney for all personal injury and death cases caused by GM's defective ignition switch, comments on today's ruling from Bankruptcy Judge Robert Gerber that punitive damages can be sought against New GM for the knowledge "inherited" from old GM with respect to the deadly ignition switch. 

Hilliard says the ruling is "a complete win for the plaintiffs."

"The Judge considered GM's arguments that it should not have to worry about punitive damages and disagreed."

"A jury will now be allowed to hear evidence of GM's cover up and determine what monetary punishment to assess for so many needless deaths and injuries."

"As GM's CEO Mary Barra has said over and over 'We do not want to ever forget.'  Well, Ms. Barra just got her wish. A jury will now be able to help GM never forget."

From the Order:

But on Product Liabilities Claims and Independent Claims alike, New GM may be held responsible, on claims for both compensatory and punitive damages, for its own knowledge and conduct. Under the Pathway #2 scenario, New GM might have acquired relevant knowledge when former Old GM employees came over to New GM or New GM took custody of what previously were Old GM records. Reliance on that, for punitive damages purposes, is permissible.

But to the extent New GM employees actually had knowledge relevant to post-Sale accident claims or Independent Claims (even if it was inherited), plaintiffs in actions asserting such claims are free to base punitive damages claims on evidence of such knowledge to the extent nonbankruptcy law permits.

The Court rules simply that evidence of information obtained by New GM after the sale "gets through the gate," and may be relied upon, for punitive damages purposes, to the extent otherwise appropriate in the underlying actions.

Nevertheless, as also discussed above, punitive damages may still be sought in actions based on post-Sale accidents involving vehicles manufactured by Old GM to the extent the punitive damages claims are premised on New GM action or inaction after it was on notice of information "inherited" by New GM, or information developed by New GM post-Sale.