General Motors twice experienced the business end of a leather glove Wednesday, when over 20 million consumers demanded satisfaction via two lawsuits totalling $10 billion in claims over lost resale value as a result of the February 2014 ignition switch recall.
Bloomberg reports two class actions would come GM’s way, the larger representing those who bought a GM vehicle between July 2009 and July 2014, whether or not they were still in possession of said vehicle.
The smaller lawsuit, meanwhile represents those who bought vehicles prior to the automaker’s bankruptcy in July 2009, though it may be muted depending on how a bankruptcy judge in New York rules next year regarding whether or not claims for accidents and economic losses made before the bankruptcy would be allowed to move forward.
According to the filing for the larger suit, “New GM’s” claims of being focused on safety and innovation were little more than a mask, resulting in diminished values of all GM-branded vehicles as a result of both the recall and the automaker’s “corporate culture of ignoring and concealing safety defects.”
For its part, GM vowed in an email to “vigorously defend against plaintiffs’ claims that GM vehicles have reduced resale value.”
Its almost winter beater time, ill take one cheap!
So what they’ll eventually get is probably a rebate on a new GM vehicle. Isn’t that what these kind of lawsuits always get?
Free oil change (filter not included).
Along with millions for the lawyers. I will never agree to one of these free burger at Burger King class actions. I, as the party supposedly affected get virtually nothing, while some lawyer is raking it in for nothing.
These suits will be settled for attorney’s bribes. Did I say bribes? No, I meant fees. The attorneys who are supposed to be looking out for the plaintiffs will sell out the plaintiffs (hey, I got you a discount on another Chevy!), and demand a few hundred million in fees. And GM will settle, because it doesn’t want the bad publicity that accompanies actually defending a lawsuit in embarrassing circumstances.
GM will reap the benefits of getting people into the showrooms to sell them new cars (apparently recalls have the same effect). The attorneys will make out like kings – tens, even hundreds of millions apiece (and they’ll share with the politicians and elected judges who protect their racket). The shareholders (and in a very extended way, new car buyers) will take it on the chin. And no one will have produced anything of value to society out of the exercise.
As Fran Liebowitz said: “Seems no matter how cynical I get, I can’t keep up.”
$10B is what the taxpayers lost bailing GM out. Oh the irony!
Resale value for these Delta-I vehicles was in the toilet anyway. What happened when people sued Toyota for the same reason?
Toyota settled for 1.63 billion dollars. Oh, the delicious irony. The UAW-promoting regime created a precedent which is now biting their number one beneficiary in the tush.
Toyota actually only settled for $250 million – specifically for diminished value. In early 2010 they were facing over 80 lawsuits specific to diminished value, representing billions in dollars in claims. They were consolidated into a single class action suit, and Toyota did a settlement, of course admitting no wrong doing.
https://www.toyotaelsettlement.com/Home/FAQ
Even vehicles not related to the gas pedal mis-shapen, floor mat, and brake computer programming recalls were included in the class action.
http://www.wsbradio.com/news/news/toyota_facing_diminished_value/njMY/
The settlement for $1.63 billion was not inclusive of diminished value class action suits and the pittance settlement.
Given this precedent, it is unlikely GM holders on highly diminished value all on their own Cobalts, G5s, and HHRs are going to get a whole lot more than the Toyota settlement.
http://www.autonews.com/article/20130719/OEM/307199952/toyotas-1-6-billion-settlement-over-sudden-acceleration-suits-wins
July 19, 2013 – 1:49 pm ET
LOS ANGELES (Bloomberg) — Toyota Motor Corp. won final approval of a settlement, valued at as much as $1.63 billion by plaintiff lawyers, with U.S. consumers who claimed that recalls related to sudden, unintended acceleration caused their vehicles to lose value.
U.S. District Judge James V. Selna, who gave the accord preliminary approval in December, signed off on it at a hearing today in Santa Ana, Calif.
The link I provided you is the official Toyota settlement site provided by Gilardi and Company LLC, the assigned claims administrator.
https://www.toyotaelsettlement.com/
…Welcome to the official website for the Toyota Motor Corp. Unintended Acceleration Marketing, Sales Practices, and Products Liability Litigation…
From the FAQ…
…Toyota is paying $250 million into a fund for distribution to eligible Class Members who: (a) sold or traded in a Subject Vehicle during the period September 1, 2009 to December 31, 2010, inclusive; (b) returned a Subject Vehicle before the lease termination date during the period September 1, 2009 to December 31, 2010, inclusive; or (c) insured and/or guaranteed the residual value of a Subject Vehicle as of September 1, 2009, and with respect to such Subject Vehicle, thereafter either made payment to an insured, or sold the Subject Vehicle, provided such payment or sale was made by a Residual Value Insurer on or before December 31, 2010; or (d) returned a leased Subject Vehicle before the lease termination date after having reported an alleged unintended acceleration event(s) to Toyota, an authorized Toyota Dealer or the National Highway Traffic Safety Administration (“NHTSA”), before December 1, 2012; or (e) had a Subject Vehicle that was declared a total loss by an insurer during the period from September 1, 2009 to December 31, 2010, inclusive…
Total agreed to claim amount is $250 million.
Now I know, this is where you stomp your feet and insist how right you are and how I hate Toyota. So one last link.
http://blog.thomsonreuters.com/index.php/toyota-mdl-plaintiffs-seek-approval-of-1-6-billion-settlement/
…According to the plaintiffs’ brief, the cash value of the class-action settlement is $757 million. This figure includes a $250 million “alleged diminished value fund,” a $250 million cash fund for plaintiffs not eligible for installation of a brake-override system and $30 million to fund university-based automotive and transportation research initiatives…
See that – that was the court’s decision and all parties agreed. $250 million “diminished value fund.”
That’s it. The number you’re quoting is technically correct (I’m not going to be a simpleton and call you a liar as you would do to me) but the actually finding for diminished value – $250 million.
Oh yes, as usually sweetie, please, have the last word, I know it is very important to you.
September 1, 2009 to December 31, 2010, inclusive; or (c) insured and/or guaranteed the residual value of a Subject Vehicle as of September 1, 2009, and with respect to such Subject Vehicle, thereafter either made payment to an insured, or sold the Subject Vehicle, provided such payment or sale was made by a Residual Value Insurer on or before December 31, 2010; or (d) returned a leased Subject Vehicle before the lease termination date after having reported an alleged unintended acceleration event(s) to Toyota, an authorized Toyota Dealer or the National Highway Traffic Safety Administration (“NHTSA”), before December 1, 2012; or (e) had a Subject Vehicle that was declared a total loss by an insurer during the period from September 1, 2009 to December 31, 2010, inclusive…
Total agreed to claim amount is $250 million.
Now I know, this is where you stomp your feet and insist how right you are and how I hate Toyota. So one last link.
http://blog.thomsonreuters.com/index.php/toyota-mdl-plaintiffs-seek-approval-of-1-6-billion-settlement/
…According to the plaintiffs’ brief, the cash value of the class-action settlement is $757 million. This figure includes a $250 million “alleged diminished value fund,” a $250 million cash fund for plaintiffs not eligible for installation of a brake-override system and $30 million to fund university-based automotive and transportation research initiatives…
See that – that was the court’s decision and all parties agreed. $250 million “diminished value fund.”
The total cash value was $757 million. That is what the plaintiff’s asked for. If you have access to Westlaw I suggest you do a lot more reading and not pick and choose selective headlines without substance on the details of the settlement.
So did Toyota face the same lawsuits from the stuck throttle calamity? Or do the gold diggers just go after GM?
Yes they did – and they still are – numerous suits are still in the pipeline, but related to accidents and deaths – not diminished value.
The ask was a lot more than the $250 million Toyota settled for. As of early 2010 there were over 40 different class action suits for Toyota diminished value, where industry watchers predicted the total payout would be close to $2 billion in a settlement deal.
http://www.reuters.com/article/2010/02/11/us-toyota-lawsuits-idUSTRE61A08820100211
Here is the info on what came out of it…
https://www.toyotaelsettlement.com/Home/FAQ
…Toyota is paying $250 million into a fund for distribution to eligible Class Members who: (a) sold or traded in a Subject Vehicle during the period September 1, 2009 to December 31, 2010, inclusive; (b) returned a Subject Vehicle before the lease termination date during the period September 1, 2009 to December 31, 2010, inclusive; or (c) insured and/or guaranteed the residual value of a Subject Vehicle as of September 1, 2009, and with respect to such Subject Vehicle, thereafter either made payment to an insured, or sold the Subject Vehicle, provided such payment or sale was made by a Residual Value Insurer on or before December 31, 2010; or (d) returned a leased Subject Vehicle before the lease termination date after having reported an alleged unintended acceleration event(s) to Toyota, an authorized Toyota Dealer or the National Highway Traffic Safety Administration (“NHTSA”), before December 1, 2012; or (e) had a Subject Vehicle that was declared a total loss by an insurer during the period from September 1, 2009 to December 31, 2010, inclusive.
Payments in this category will depend on the make, model, and model year of the Subject Vehicle, when the Subject Vehicle was sold or returned, the state in which the Class Member resides, the number of claims submitted, and other adjustments and deductions.
Payments will be reduced on a pro rata basis except for those Class Members who completed and submitted a proper Claim Form by July 29, 2013…
So in the end, owner’s didn’t get a whole lot from the impacted class.
The lawyers will take any opportunity to do these frivolous lawsuits. Until there is a repercussion for it, they will do it. How about we finally make the loser in a lawsuit pay the legal bills? That would end it.
GM is just a natural target because of their greed and incompetence. They will never learn even after the next government bailout. GM is like a bleeding hemorrhoid on the ass of America. It is all about selling cheap products at over inflated prices to pay off the UAW and all the corrupt management. It will never change until the UAW is defeated and all of the management is fired or sent to prison.
Whew! Negativity to the max! Name another car company that gives away their products for just a tiny profit, quality is perfect, management are all angels, the workers union is all goodness and light, and, what other planet is this company located on?
Negativity like this:
“Or do the gold diggers just go after GM?”
Thats just all nonsense…
There are decades of poor quality GM products that spoke for themselves as folks left them in droves for other brands (mostly Japanese). The creative destruction that a bankruptcy would have wrought would have displaced the multiple tiers of feckless GM apparatchiks and something good might have risen from whomever purchased the assets at bankruptcy. But the market-distorting hand of pandering politicians reached down from their D.C perch and bailed GM out with our tax $$$$ – which left the feckless fools in place along with the rancid culture. And we see the results.
Friends don’t let friends buy GM cars. . Ever .
GM trucks are and have always been dang swell. Except for the recent idiot square wheel wells.
What a bunch of know it alls! As a lifelong mechanic, and car nut, I know that each car company has their good and bad. I have Japanese and GM cars, the early Japanese cars rust away so fast it makes your head swim, the early Buick engines self destruct, but the Oldsmobile V-8’s are fabulous, as well as Japanese L-6 engines. For the most part GM cars have been good quality as compared to other domestic products. Ford had bad V-8 engines for years, (351-400M), Chrysler had weak front suspensions for years, Ford Taurus and Sables all have bad automatics, I could go on to talk about all the imports strength’s and weakness’s. Mercedes quality is good, but how can you afford the parts prices? How many VW Beetles do you see on the road today as compared to older GM cars? I can’t believe the cheap plastic door handles and knobs in Volvo’s that just break off in your hand! You can’t bash GM without bashing each and every other car company on earth.
“when over 20 million consumers demanded satisfaction”
20 million consumers didn’t do anything. A couple of trial lawyers have found a few prospective claimants and used that as a basis to file a class action lawsuit that hopes to encompass 20 million GM customers.
If past history is prologue, there will be a settlement that allows the lawyers to split a few hundred million dollars, the initial claimants will get some money, and 19.99 million others will get coupons for free floormats with their next GM car.
I have no love for GM, but that first paragraph of the post sounds like a press release from a law firm.
Way to hose off the BS to find a couple tiny lumps of reality.
Didn’t a group of speculators hit Porsche with this same kind of lawsuit a while back?
Chevy Cobalt, what lost value? There needs to be value before it can be lost!
This.
This. If you do your due diligence before you buy, you’ll realize GM products don’t have as much resale value in the first place. You buy them and drive them until they drop dead in your driveway. Then when you realize you have to drop the entire front undercarriage to replace the transmission, you decide it’s cheaper in the long run to just buy a used Honda.
Maybe I have been hit on the head one too many times. But I still think that the Cobalt Coupe was one good looking compact, as crappy as the car may have been otherwise.
And the HHR was better looking than the PT Cruiser. So what? Both are still junk, like the rest of GM and Chrysler. Who is still buying these things?
I couldn’t agree more. GM – Chrysler – Ford <– decades of inferior products sold to uninformed people. Who indeed still buys them…
In other bad GM news Volkswagon is now the worlds number two carmaker. GM should cut their loses and sell only Corvettes and Cadillacs.
Ya, because Cadillacs are selling so well. Forget China and all the Buicks they sell there. The future is in Corvettes and Cadillacs!
Derp!
Don’t depreciating assets, er, DEPRECIATE anyway? How are they going to determine value lost, especially if a known problem is fixed?
Cadillac is building the only american world class vehicles. I sat in a cruze and fusion the other day and was horrified at the cheapness.
The cruze is the same kind of excrement the cobalt was.
GM eats donkey balls.
That’s not very fair to the Cruze. The Cruze is a decent small(ish) car. It’s not Lexus level quality, but they don’t charge Lexus money. Even Jack Baruth was pleased with how his high mileage rental was holding up. This compared to the complete junkpile that was the Cobalt is a very large leap forward.
Sad that a Daewoo-engineered vehicle is so vastly superior. Really says something, doesn’t it?
Why the sadness that Koreans engineer a good small car?
Are you shocked that GM lost its ability to engineer a great small car, as evidenced by the Vega, Chevette, Cavalier and Cobalt?
Are you saddened that GM is thoughtful in how it deploys its global workforce to align activities with skillsets?
Because, of course, you aren’t saddened that white guys at GM couldn’t engineer a world class small car like Asians can, because that would sound racist.
Well, it’s a leap to call the Cruze “good,” “great,” or “world class.” It’s decent transportation, nothing more. I am amazed, though, that such a generally competent product came from the same company that produced the horrid Lanos, Nubira and Leganza.
Daewoo advanced significantly in 10 years. GM’s home team didn’t. That is what is sad.
Hey, I love my Chevettes! Seriously!
It sure does. It’s a darn crying shame that Hyundai/Kia and “Daewoo” can build a vastly better B-segment car than Toyota – e.g. Yaris versus Accent versus Sonic.
Wait a minute…that would mean that Koreans can actually engineer great cars.
Your post stretches credibility to the max. Seriously. The Cruze interior is far superior to the last rental 2014.5 Camry I had for a weekend let alone the cheaper Corolla that it competes with. When dash vents start popping out over railroad tracks, headliners sound hollow and tinny, seat material feels like sand paper and parts of the gear shift indicator are already wearing away after 10k miles that constitutes a cheap crap interior. I have rented 5 Cruzes and none ever suffered these issues. The Fusion’s interior blows the Camry out of the water and rates right up with Accord.
I have never been able to rent a Cruze…they are never available. I finally got to rent a Sonic. A 2015 LT with 4GLTE WiFi hotspot and the right equipment check boxes checked off.
My fiance and I were stunned at how good it was for an econobox. Ya, hard plastic but nothing felt cheap or out of place, the Infotainment system was excellent, the stereo was good, and it was a blast to drive. We were really surprised at highway manners, a compliant ride that was surprisingly quiet for the segment and zipped along at 75 to 80 MPH with no protest.
Having had an older Aveo in Mexico earlier this year, it was a STUNNING contrast on how far GM has come in the B-segment.
But I’ve only been able to drive a Cruze very briefly at an event at a car show. Also impressed – but never any at the rental lot. The conversation typically goes with a Corolla offer, and me upgrading to a Fusion.
I had a rental trim Camry (stripped not equipped) a few years ago and it was just awful. One of the worst rental cars I ever had (the Ford Taurus, both a 1990 and a 2008 remain number one and two on my list, followed by the Buick Lucerne with the 3.8L V6 for the worst three – the Camry is in 4th.
I thought the Cruze was pretty nice on a test drive. The problem was the engine and transmission for me with the 1.4 turbo. Not enough power/slow shifting. The diesel Cruze fixed those problems, but I wasn’t about to pay $27000 for a Cruze.
I couldn’t find the post claiming that GM won’t defend itself from these lawsuits, but to go back a few years, the Corvair story: GM lost the first Corvair lawsuit. They weren’t prepared and weren’t expecting it. But then they did prepare, and then for each subsequent lawsuit, they won, and didn’t loose any more Corvair lawsuits.