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In re General Motors Corp., et al

Topic(s): Scope of Statutory Rights and Remedies

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Description:

On June 19, 2009, Public Citizen, on behalf of itself, Center for Auto Safety, Consumer Action, Consumers for Auto Reliability and Safety, and National Association of Consumer Advocates, filed an objection in the federal bankruptcy court in New York that is overseeing the GM bankruptcy proceeding, asking the court not to eliminate the rights of consumers who have suffered or will suffer injury or loss caused by defects in GM vehicles to seek compensation from New GM. We argued that, under the Bankruptcy Code, GM could not be sold free and clear of product liability claims, and that eliminating the future claims of people who have not yet been injured violates the Constitution.

In its response to the bankruptcy objections, GM announced that the New GM would assume liability for product liability claims for death, personal injury, or injury to property caused by accidents that occur after the bankruptcy closing date and arise from the operation of GM vehicles. The sale documents, however, would still release New GM from liability for claims of consumers who have already been hurt.

On July 5, 2009, the bankruptcy court approved the sale.

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