Consumer Law

Consumer Groups Protest Chrysler & GM Avoiding Product Liability Claims

By Kemnitzer, Anderson, Barron, Ogilvie & Brewer

Chrysler and GM are using the bankruptcy proceedings to bar persons injured in accidents due to defects in their vehicles. Thanks to the bankruptcy, owners injured or killed due to product defects in vehicles produced before Chrysler's bankruptcy filing are barred from making any claims. GM agreed to consider claims related to cars manufactured before the company is sold to a new entity, so long as the accident happens after the sale is completed. Claims related to accidents that occurred before the sale will remain with the "old" GM, and, as with Chrysler, plaintiffs would recover very little, if anything.

A few days ago, consumer groups petitioned the Federal Trade Commission yesterday to require that Chrysler vehicles display stickers warning prospective buyers of liability risks. A KGO-TV story on this controversy is here.

Congressman André Carson (D-Ind.) has proposed legislation that would require all automakers to purchase liability insurance if they are majority-owned by the federal government or if they have federal loans.

Full post as published by Lemon Law Blog on July 03, 2009 (boomark / email).