— General Motors has agreed to pay $575 million to settle two legal actions concerning defective ignition switches that killed and injured hundreds of people.
GM settled the two actions, the first to resolve a shareholder class-action lawsuit filed in Michigan, the second to reach an agreement concerning 1,385 death and personal injury claimants. They include more than half of the personal injury plaintiffs who have lawsuits pending in the multidistrict litigation in the U.S. District Court for the Southern District of New York.
The deal was reached with Texas attorney Bob Hilliard to settle 1,385 injury and death claims after crashes were allegedly caused by the ignition switches. Hilliard is the attorney responsible for clearing all charges against LaKisha Ward-Green and Candice Anderson, two women wrongfully convicted in accidents caused by GM ignition switches.
Just as GM bought it's way out of federal wire fraud charges and charges against its employees, the automaker is also getting off with a slap on the wrist with the $575 million settlement.
Thanks to a cozy bankruptcy agreement, a federal judge said GM had immunity for its actions prior to July 2009. That decision meant hundreds of GM owners couldn't sue the automaker even though GM was hiding the ignition switch defects prior to 2009.
In the cases of wrongful death, a special "master" will be appointed to decide how much to offer to each plaintiff. Attorneys expect the number of death claims will reach 250 by the time all cases are settled.
The $575 million settlements won't be the end of the story as another 454 injury and death claims remain to be solved. Six of those cases are scheduled for trial as early as January 2016.
The automaker said it will record a charge of $575 million in the third quarter.