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| | Massive Liability Class Action Suit to Cost GM Millions By John Millrany - April 19, 2001Discounts from $250 to $1,000 on new General Motors vehicles and a $4.1 million GM-funded safety research program are two elements of a long-litigated mass claim settlement relating to defective fuel systems, according to a State of Louisiana court decree.
Dating back to 1992, the court case zeroed in on owners of 1973-86 GM C/K pickups and 1987-91 R and V model pickups that had alleged defective fuel systems, subjecting millions of vehicles to potential fire or crash-caused explosions. The settlement will render discount coupons to current and former owners, but only if they owned the trucks in July 1996.
GM manufactured 9 million full-size trucks and a lesser number of smaller vehicles that featured side-saddle fuel tanks. Installed outside the protective frame rails, the failed fuel systems resulted in scores of serious injuries and deaths, the court concluded.
Thought to be the largest automobile case in terms of the numbers of class-action participants, the settlement could cost GM anywhere between less than $100 million to over $1 billion, contingent on how many discount coupons are redeemed, analysts said.
The lawsuit, in which GM Corp. did not admit liability, coincided with an investigation by the National Highway Traffic Safety Administration, which concluded in 1994 that the trucks had a serious fire risk. However, rather than carrying out a recall, NHTSA brokered a settlement, ticketing GM with $51 million in damages. |