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GM reaches $900 million settlement of criminal charges over faulty ignition switches
GM reaches $900 million settlement of criminal charges over faulty ignition switches

[JURIST] The US Department of Justice (DOJ) [fficial website] announced Thursday that General Motors (GM) [corporate website] has reached a deal to accept charges of wire fraud and a $900 million fine [press release] for allegedly concealing information about ignition-switch defects for more than a decade. Under a deferred-prosecution agreement, the criminal charges will likely be placed on hold [WSJ report] as long as GM abides by all other terms of the deal, and no individual employees will be charged. Last year, a class action lawsuit was filed [JURIST report] in federal court in Texas against GM claiming that customers’ vehicles have lost value due to ignition problems blamed for a series of fatal crashes. The defect, believed to have been linked to 124 deaths, caused GM to recall 1.6 million cars, which led government criminal and civil investigations, an internal probe by GM and preparations for congressional hearings.

In recent years other car manufacturers have also faced legal issues for allegedly failing to address malfunctions. The US National Highway Traffic Safety Administration (NHTSA) [official website] announced [JURIST report] in July that it imposed a $105 million penalty against Fiat Chrysler [corporate website] for its failure to provide a remedy and notices for 23 recalls related to automobile malfunctions. In 2014 the DOJ announced a $1.2 billion settlement [JURIST report] agreement with Toyota for misleading customers and US regulators. In November 2012 Toyota settled [JURIST report] a class action lawsuit for $35.5 million brought by its shareholders failing to disclose vehicle quality issues.