General Motors should pay for concealing an ignition-switch defect from its customers that has been linked to nearly 400 injuries and deaths, an attorney for an Oklahoma man injured in a car crash told a Manhattan jury Tuesday.
“This case is not just about an accident that occurred in Oklahoma in 2014,” said Robert Hilliard, who is representing plaintiff Robert Scheuer. “This is about the conduct of a company over a period of time that spanned more than a decade.”
Key GM employees knew about the problem for more than 10 years, Hilliard said, adding that evidence would show the automaker’s “coverup” of a dangerous safety flaw.
His comments came in opening statements in the first trial since GM’s recall of 2.6 million vehicles, including Scheuer’s 2003 Saturn Ion, over an ignition switch that could inadvertently slip to an “off” or “accessory” position while the car was moving, stalling engines and disabling critical systems such as air bags.
Scheuer’s case, in which he is seeking unspecified compensatory damages as well as punitive damages, is the first of six that have been selected to serve as a “bellwether,” or test, trials in federal litigation over the switch.
GM has agreed to pay roughly $2 billion to resolve legal claims and probes in connection with the switch problem, which thrust the company into the hot seat with Congress, regulators, prosecutors and the public two years ago.
Although Scheuer followed GM’s instructions to remove all but a single key from his key ring, the ignition switch slipped to “off” during a May 2014 highway crash, Hilliard said. The air bags failed to deploy, and Scheuer suffered neck and back injuries.
While acknowledging “mistakes and errors in judgment made by GM employees” over the switch, GM’s lawyer, Mike Brock, said the switch was not to blame for Scheuer’s injuries.
MetLife, the largest U.S. life insurer, plans to separate much of its retail business as chief executive Steven Kandarian works to shrink the company to limit federal oversight.
The insurer is weighing a possible sale, spinoff or public offering of the operation, New York-based MetLife said in a statement Tuesday. The new company would have about $240 billion of assets and account for approximately 20 percent of MetLife’s operating earnings, according to the statement.
MetLife joins GE’s finance unit in seeking to simplify operations after being designated by a U.S. panel as a non-bank systemically important financial institution, a tag that can lead to stricter limits on the balance sheet.
The unit faces “higher capital requirements that could put it at a significant competitive disadvantage,” Kandarian said in the statement. “Even though we are appealing our SIFI designation in court and do not believe any part of MetLife is systemic, this risk of increased capital requirements contributed to our decision to pursue the separation of the business.”
MetLife said Executive Vice President Eric Steigerwalt will lead the new company.
— Bloomberg News
● Chinese conglomerate Dalian Wanda Group has bought U.S. film studio Legendary Entertainment for about $3.5 billion, as China’s richest man steps up a drive to diversify his business empire overseas. Wanda Chairman Wang Jianlin, whose personal wealth is estimated by Forbes magazine to be about $27 billion, said in Beijing Tuesday that he plans to package Legendary, behind hits like “Jurassic World,” with existing movie production assets in China and sell shares in the merged operation in an IPO.
● No. 3 U.S. railroad CSX on Tuesday reported a lower quarterly net profit, citing a drop in freight volumes, especially a 32 percent decline in the amount of coal hauled. The Jacksonville, Fla.-based railroad reported fourth-quarter net income of $466 million, or 48 cents per share, down 5 percent from $491 million, or 49 cents per share, a year earlier. Analysts had on average expected earnings per share for the quarter of 46 cents.
● U.S. employers advertised slightly more jobs in November as overall hiring edged up and more Americans quit their jobs for others in signs of a healthier environment for workers. The Labor Department said Tuesday that the number of job postings rose 1.5 percent, to a seasonally adjusted 5.4 million. That figure has slipped after peaking at a record 5.7 million in July but is 11 percent higher than a year ago. Only manufacturers have pulled back on job openings over the past 12 months, a reflection of the stronger dollar and weak international growth hurting sales abroad.
● The European Commission said Tuesday it had launched an in-depth investigation into Halliburton’s planned purchase of its oil-field services rival Baker Hughes. Halliburton offered in November to buy Baker Hughes for about $35 billion in cash and stock, creating an oil-field services behemoth to take on market leader Schlumberger. Halliburton expressed confidence that the tie-up of the No. 2 and No. 3 players in the oil-field services industry would clear regulatory hurdles. But the two companies said last month that U.S. antitrust officials were not satisfied with proposed concessions.
● The European Union will analyze an antitrust complaint that accuses fast-food giant McDonald’s of abusing its dominant position at the expense of its franchisees and consumers. The complaint comes on top of an E.U. investigation opened last month into whether McDonald’s received a sweetheart tax deal from Luxembourg. An alliance of Italian consumer groups backed by trade unions claims that McDonald’s compels franchisees to lease property it owns at excessive prices and imposes restrictive contracts. They say that can force franchisees to charge higher prices and offer inferior-quality goods to consumers. McDonald’s defended its operating practices with franchisees.
— From news services
● 2 p.m: Treasury Department releases federal budget for December.
● ● 2 p.m: Federal Reserve releases “beige book” report on regional economic conditions.