Consumers, Lawyers Say New GM Should Still Pay for Injuries
Thursday, June 18, 2009
In October 2005, Jeremy Warriner swerved his new Jeep Wrangler to avoid an oncoming car and crashed into a utility pole. The pole fell, trapping Warriner inside the car. Then, allege engineers hired by his attorneys, the plastic brake fluid reservoir broke, setting the Jeep on fire.
Warriner awoke from a medically induced coma 5 1/2 weeks later with two amputated legs.
But his lawsuit against Chrysler ended before it even went to court. A federal bankruptcy court's decision to allow Fiat to buy the automaker last week exempted the "new" Chrysler from past product liability claims. Now consumer groups are mobilizing to block General Motors from seeking similar protections in bankruptcy.
"This is not a normal bankruptcy," said Warriner, 34, of Indianapolis. "It has been financed with our tax dollars. Our tax money is being used in a manner that blocks our Seventh Amendment right to a trial."
Yesterday, an ad hoc committee representing hundreds of people injured in GM and Chrysler vehicles launched a television ad campaign protesting government-managed restructurings that throw "consumer safety protections out the window."
"We all want GM and Chrysler to thrive -- but not at the cost of our own survival," says one spot airing in Washington.
Lawyers are scrambling to file paperwork by Friday to oppose the sale of GM's assets. Christine Spagnoli, president of Consumer Attorneys of California, said the automakers' pledge to guarantee warranties, parts and maintenance is misleading to customers.
"They're saying, 'If your brakes are bad, we'll fix them. But if you crash and get hurt because your brakes are bad, we don't want to be accountable for that,' " she said.
Warriner will still be able to seek compensation from the "old" GM and Chrysler, which will stay in bankruptcy to liquidate hard-to-sell assets like real estate. But senior Treasury adviser Ron Bloom told a Senate committee that personal injury awards would likely be smaller.
"We really don't have an alternative, other than to essentially write an endless check to deal with that situation," he testified last week.
So consumer groups are pressing Congress to intervene. One solution is to require the "old" companies to have product liability insurance to cover claims. Another is to set up a special trust for victims, as with the bankruptcies of asbestos manufacturers.
Warriner's mediation date was scheduled for May 5. But on April 30, Chrysler filed for Chapter 11.