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Mark Bello
Mark Bello
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The Dangers of Protecting the “New” GM and Others from Lawsuits

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Congress is demanding answers as to why it took GM nearly a decade to recall 2.6 million small cars with a defective part that led to unexpected stalling.  GM says that when Cobalts and other compact cars, including the Saturn Ion hit a bump, the switch can slip out of the “run” position, causing the engine to shut off in traffic. This can lead to loss of power steering, power brakes, and air bags making it difficult to control the vehicle.  The faulty switch is now linked to at least 12 deaths and numerous accidents.

GM said that although engineers proposed solutions to the problem in early 2005, the company failed to take action due to costs.  Now, documents provided by GM show that the “unacceptable cost increase” was only 57 cents; less than $40 per vehicle.  CEO Mary Barra apologized for the “old” GM and noted the company is now focusing on safety and putting customers first, yet the “new” GM continued the cover-up – at least until it got caught.  How is this putting customers first?  If GM wasn’t facing bad publicity and lawsuits, would a recall have been issued?

Here we are, 36 years after the Pinto fiasco and auto manufacturers continue to cover up known defects until media scrutiny puts pressure on these companies to take action.  The industry opposed seatbelts, airbags, and better emission standards.  Resistance to regulation, failing to disclose problems, and refusing to correct problems when detected has caused preventable deaths, illnesses, and injuries.  Sadly, putting profits over safety of the American people has become the norm.  But, GM does not stand alone and neither is the auto industry.  Hiding behind the corporate veil has affected almost every industry including food, pharmaceuticals, and tobacco.

Recalls before injuries occur are important pro-safety measures. However, if automakers are still willing to risk lives to save money, that behavior should be exposed; innocent victims should not be the scapegoat for their cover-ups.

GM is attempting to use its 2009 bankruptcy filing as protection from these lawsuits. As part of the taxpayer-funded bail out, the company was granted immunity from all past product liability lawsuits. Innocent victims become the scapegoats for GMs blatant cover-up.  Even without the bankruptcy, the victims would be re-victimized.  Tort reform, like bankruptcy, causes innocent victims to be restricted from the compensation they deserve.  GMs profits will be protected, your friendly neighborhood legislator has seen to that.  When manufacturers rail against our civil justice system, they’re basically saying, “We should not be held responsible for our mistakes; after all it affects our profits,” How is that focusing on safety and putting customers first?

It is this philosophy, put forth by large corporations and the US Chamber of Commerce for years that I have been railing about.  These companies and the legislators that they purchase through unlimited campaign contributions (thank you, Supreme Court!) make certain profits are king in America and citizens are sacrificial lambs.  History has shown that lawsuits act as a deterrent against negligence. It’s difficult for a company to continue its irresponsible behavior when it is constantly being held accountable in a court of law.  Unfortunately, safety concerns get lost in the tort reform shuffle and the battle for campaign donations.

Tort reform limits the rights of those injured by defective products, medical malpractice, and other wrongdoing and shifts responsibility to entitlement programs.  Instead of taking responsibility for lax safety standards and defective designs, auto makers, essentially, use tort reform to make taxpayers cover the costs of their negligence.  When legislatures take away from juries the right to value human life or to award punitive damages, they tend to give corporations a “free pass” to manufacture cars, build roads, develop pharmaceuticals, and sell other products with less concern for the value and sanctity of human life than for their bottom lines.

We can’t continue to put auto industry, or any corporate profits ahead of justice. Shouldn’t irresponsible manufacturers pay for the results of their cost-cutting?  How many times does history have to repeat itself for people to get the point?

Mark Bello has thirty-seven years experience as a trial lawyer and fifteen years as an underwriter and situational analyst in the lawsuit funding industry. He is the owner and founder of Lawsuit Financial Corporation which helps provide cash flow solutions and consulting when necessities of life litigation funding is needed by a plaintiff involved in pending, personal injury, litigation. Bello is a Justice Pac member of the American Association for Justice, Sustaining and Justice Pac member of the Michigan Association for Justice, Member of Public Justice, Public Citizen, the American Bar Association, the State Bar of Michigan and the Injury Board.

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  1. Brett Emison says:
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    Mark – nice post.

    It’s criminal that GM could escape liability for these injuries and deaths under the bankruptcy protection it received on the backs of US taxpayers. As John Stewart pointed out – what if an actual person (rather than a corporate “person”) tried a similar defense? http://thedailyshow.cc.com/videos/li1grj/true-defective–gm—ms–barra-goes-to-washington