Blumenthal Wants Holder to Intervene for Individuals Against General Motors in Recall Lawsuits
By Jeffrey Benzing | March 24, 2014 5:05 pm

Sen. Richard Blumenthal (D-Conn.) today asked the Justice Department to intervene in civil actions against General Motors and require the auto manufacturer to immediately set up a fund to compensate victims who suffered injury or death because of faulty ignition switches.

The Justice Department is already probing the company’s handling of a safety recall after faulty ignition switches were linked to the deaths of at least a dozen and possibly more than 300 individuals.

Blumenthal in a letter today asked Attorney General Eric Holder to immediately step in to aid individuals hurt by the company’s alleged failure to notify consumers and regulators of malfunctioning automobiles.

“Without your active involvement, they may have no meaningful remedy,” Blumenthal wrote, saying the Justice Department has a moral obligation to protect consumers because of the government’s involvement in a 2009 reorganization of the company.

The senator, who served as Attorney General in Connecticut for two decades, is concerned that victims will suffer because a bankruptcy court ruling will allow the company to avoid legal responsibility for defects prior to 2009.

Sen. Richard Blumenthal

Sen. Richard Blumenthal (D-Conn.)

Blumenthal was among eight state attorneys general who opposed the liability shield in 2009, though it was supported by the company and the federal government, Blumenthal wrote.

General Motors in February began a recall of 1.6 million vehicles with malfunctioning ignition switches that might deactivate airbags in collisions. The problem was initially linked to the deaths of about a dozen individuals, though an auto safety watchdog group said federal data shows that the faulty switches could have caused the death of hundreds of individuals.

Blumenthal, who also served as U.S. Attorney in Connecticut, said GM criminally deceived the public and the federal government by not coming forward sooner with concerns over potentially deadly ignition switch failures.

“Like many Americans I was appalled and astonished by GM’s recent admission that it knew of these disabling defects and their disastrous effects well before the 2009 reorganization,” Blumenthal wrote.

Justice Department intervention, he wrote, is needed to keep the company from trying to avoid liability.

Suits have been filed in state court but GM is removing them to federal court and asking that they be moved to bankruptcy court, Blumenthal wrote.

Blumenthal also wants the Justice Department to force GM to set up a compensation fund for victims as it probes the company’s handling of the auto recall.

“This civil remedy could be done as an interim step, even before completing your criminal investigation and prosecution,” Blumenthal wrote.

A representative from General Motors did not immediately respond to a request for comment.

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