The Breakdown

Explaining Southern California's economy

Some lawsuits against GM originate in Southern California

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General Motors CEO Mary Barra is set to testify Tuesday and Wednesday before congressional committees to explain the automaker’s recall of 2.6 million vehicles due to faulty ignition switches.

Lawsuits against the company have been piling up, with some filed in California.

The Seattle-based consumer-rights law firm Hagens Berman filed one of the lawsuits in federal court in Santa Ana.  The suit seeks class action status and argues owners of the recalled vehicles will suffer economic loss as the vehicles decline in value. 

The complaint, filed on March 19,  in the U.S. District Court of California, Central District alleges that G.M. failed to alert consumers of the known risks they faced driving the vehicles, despite promising it would honor the federal reporting requirement of safety risks for all General Motors cars. 

One question for the courts: whether the new GM the government helped bail out of bankruptcy in 2009 is responsible for legal claims relating to incidents before that.  Rob Carey, managing partner of Hagens Berman's Phoenix office said both the old General Motors and the new company are responsible.

"New GM said we will report for Old GM vehicles ALL safety problems. And they clearly didn’t do that," Carey told KPCC.  "so that’s going to put them on the hook for consumer violations for being deceptive and unfair in not complying with the federal obligations to notify the National Highway Traffic Safety Administration that these cars have problems." 

In written testimony released ahead of a Tuesday House subcommittee hearing, acting National Highway Traffic Safety Administration chief David Friedman said GM had information connecting defective ignition switches to the non-deployment of air bags, but didn't share it until last month.

Hagens Berman reached a $1.6 billion settlement with Toyota over its sudden acceleration problems. Carey said so far, at least four of the named plaintiffs against GM are from California, including a woman from Irvine.

Chicago-based law firm Grant and Eisenhofer also filed a lawsuit against GM in federal court in San Francisco, with several other firms nationwide involved. Lieff Cabraser Heimann & Bernstein and another firm filed a lawsuit in Los Angeles.

"The interest and outrage among California residents is very high for this case," said Adam Levitt of Grant and Eisenhofer, who added that since filing the suit with a named plaintiff from Santa Rosa, the firm has received a lot of phone calls from other potential plaintiffs. 

Los Angeles-based attorney Aaron Jacoby, who chairs the automotive practice of the law firm Arent Fox said California’s laws make it a very consumer-friendly state.

"California, especially Southern California is considered a very high jury verdict award area," Jacoby told KPCC. 

Most of the claims so far center on economic losses and do not involve personal injury claims, though Elizabeth Cabrazer of Lieff Cabraser Heimann and Bernstein tells KPCC that the firm is "investigating and preparing individual cases on behalf of victims of accidents in which the ignition switch defect is implicated."

General Motors hasn't yet named the 13 people believed to have died in accidents as a result of the faulty ignition switches, as CNN Money reports, though the company is required to turn details of the accidents over to the National Highway Traffic Administration by April 3rd.

General Motors won't comment on the lawsuits but has set up a page on its web site to answer questions about the recall. 

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