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Grant & Eisenhofer and National Coalition of Major Trial Firms Bring Class Action against General Motors Over Defective Key System

Suit filed in San Francisco seeks economic recovery for owners and lease-holders of GM cars whose faulty key systems were prone to sudden shut-down, a problem GM concealed for a decade; plaintiffs represented by Grant & Eisenhofer, Baron & Budd, The Coope

SAN FRANCISCO, March 24, 2014 /PRNewswire/ -- As General Motors braces for bruising investigations by Congress and federal regulators over its decade-long failure to correct faulty ignitions switches on several of its major car brands, GM now also faces a private class action filed by a group of GM consumers from nine states seeking economic recovery on behalf of a nationwide class for purchasing and/or leasing vehicles they allege the company knew were defective.

The suit accuses the auto giant of fraudulently concealing material facts regarding the scope and extent of problems with its key system, which have been linked to at least 31 crashes and 13 fatalities nationally.  The company is in the midst of a massive recall involving some 1.6 million vehicles carrying the defective switches.

The suit, filed today in the U.S. District Court for Northern California in San Francisco, contends that GM knew its key system posed an "increase[ed] risk of injury or fatality" as far back as 2001 but failed to take proper steps to correct the defects, which could cause certain Chevrolet, Pontiac, and Saturn cars to shut down without warning while being driven.  In addition to rendering the cars' power steering and brakes inoperable, the ignition failures caused the safety airbags to stop functioning, putting drivers at extreme risk in a collision.  GM has publicly admitted that its keys could inadvertently slip out of the "run" position with the car's engine on.

Today's action was brought by 13 GM customers who bought and leased its cars in a number of states, including California, Arkansas, Georgia, Illinois, Louisiana, Missouri, Texas and Vermont.  More plaintiffs are expected to join the suit, which covers a variety of GM cars for model years ranging from 2003-2010 (a full list of the vehicles covered follows below).

The plaintiffs argue that GM was fully aware that the problems extended beyond just the ignition switch mechanism that has been the focus of the recall.  According to their complaint, the company's engineering documents show that the defects also included the placement of the switch in the steering column and a lack of adequate protection from normal, incidental contact by drivers.  "To fully remedy the problem and render the defective vehicles safe and of economic value to their owners again, additional design elements beyond a new ignition switch are needed," the complaint states.

"The fact that GM has, to date, issued a partial recall knowing the insufficiency underscores GM's ongoing fraudulent concealment and misrepresentation of the nature and extent of the defects," the complaint continues.

Separate from ongoing personal injury and wrongful death lawsuits against GM, the latest action is asking the court to compel the company to undertake a full repair and overhaul of the affected key systems so that all defective vehicles can have their value restored.  Consumers are also seeking monetary compensation for the diminished value of their cars.

"It is tremendously disappointing that General Motors, which was bailed out by U.S. consumers during the financial crisis, has been carrying on the most egregious and far-reaching cover-up in automotive history because it didn't want to assume the costs of fixing cars it knew to be dangerously defective," said Adam Levitt, one of the lawyers representing the plaintiffs group.  Mr. Levitt is a director of prominent litigation firm Grant & Eisenhofer, where he heads the firm's Consumer Practice group, and is currently leading its litigation on behalf of Ford Motor customers seeking redress from Ford vehicles that were subject to incidents of sudden, unintended acceleration.

According to the complaint, GM could have placed a simple protective shield around its key system to keep it in place and prevent it from disengaging, thereby disabling the cars.  "We intend to show that despite the option of a straightforward fix, GM chose to dismiss the solution because of the added costs involved in undertaking a voluntary recall," Mr. Levitt said. 

He noted the irony of GM's current advertising campaign, encouraging drivers to "Find New Roads" in their personal journeys.  "We hope GM's ad slogan also refers to the roads of truth and corporate accountability, which this affair reveals have been the roads less traveled by the company for a long time."

In addition to Grant & Eisenhofer, plaintiffs are represented by noted litigation firms Baron & Budd PC of Dallas and The Cooper Firm of Marietta, Georgia.  Cooper's principal partner Lance Cooper is recognized as the attorney who first uncovered GM's key system problem, as well as the company's years-long effort to hide it.

Other major firms comprising the litigation team include Bartimus, Frickleton, Robertson & Goza, P.C.; The DiCello Law Firm; Conley Griggs Partin LLP; Spilman Thomas & Battle PLLC; Bucci Bailey & Javins L.C.; and Siprut P.C. 

Among the lawyers participating in the action are Edward D. "Chip" Robertson, Jr., who served as Chief Justice of the Missouri Supreme Court, along with Sharon L. Potter, a former U.S. Attorney for the Northern District of West Virginia. 

"We have an incredibly strong national trial team, supported by several highly respected experts with extensive experience in large-scale automotive cases," noted Mr. Levitt of Grant & Eisenhofer.  "We also believe we're bringing a set of facts to our complaint that are unique with respect to GM's conduct regarding its defective key system and its subsequent cover-up."

The lawsuit, which is seeking class action status, covers owners and lease-holders of the following GM vehicles – dates indicate model years:  Chevrolet Cobalt (2005-2010); Chevrolet HHR (2006-07); Pontiac Solstice (2006-07); Pontiac G5 (2005-07); Saturn Ion (2003-07); and Saturn Sky (2007).

Grant & Eisenhofer, P.A. (www.gelaw.com)

Grant & Eisenhofer represents plaintiffs in a wide range of complex financial litigation. G&E's clients include institutional investors, whistleblowers and other stakeholders in bankruptcy litigation, securities class actions, derivative lawsuits, consumer class actions, antitrust suits, and cases involving the False Claims Act. G&E has recovered more than $13 billion for its clients and class members in the last five years alone and has consistently been cited by RiskMetrics for securing the highest average investor recovery in securities class actions. G&E has been named one of the country's top plaintiffs' law firms by The National Law Journal for the past 10 years.

From:  Allan Ripp 212-262-7477 [email protected] 
          Elise Martin 302-622-7004 [email protected]

SOURCE Grant & Eisenhofer, P.A.

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