Judge rules GM can be sued for punitive damages over ignitions

In a case that may have an impact on Arkansas motorists, a federal bankruptcy judge ruled on Nov. 9 that people suing General Motors over recalled ignition switches can seek punitive damages. The decision could potentially cost the automaker millions of dollars.

GM recalled the faulty ignition switches in February 2014 because they can slip out of position and suddenly cut off a vehicle's engine, cutting power to the steering, brakes and air bags. The design flaw is blamed crashes that killed at least 169 people and injured hundreds more.

GM emerged from bankruptcy in 2009 and became known as "New GM," a new business entity that is shielded from the liabilities of the old company. However, the ruling by a New York bankruptcy judge will allow plaintiffs to seek punitive damages from "New GM" if they can prove that the car manufacturer and its management knew about the dangers of the faulty ignition switches after the bankruptcy had concluded and continued to cover it up.

The same judge ruled earlier this year that "New GM" was shielded from lawsuits related to accidents that occurred before the company emerged from bankruptcy. The automaker is still liable for crashes that happened after the bankruptcy. There are reportedly around 250 injury and wrongful death claims related to the faulty switches pending in state and federal courts.

People who have been injured in a car crash caused by a defective product or part may want to discuss their situations with an attorney. Product liability litigation is complex, and legal counsel can determine how best to go about collecting evidence that can show that the manufacturer was aware of the defect but failed to correct it or warn the public in a timely manner.