Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comKey Contacts
Back
General Motors Co. is returning to the same Manhattan bankruptcy court that granted it protection under Chapter 11 of the bankruptcy law in 2009 to face owners of recalled cars, according to Bloomberg Businessweek. The company faces 59 lawsuits by car owners, who are demanding a combined total of as much as $10 billion in damages. The lawsuits center around recalled cars with faulty ignition switches, which shut off the engines while the car is being driven in some circumstances, and prevent airbags from deploying.
In the 2009 ruling, U.S. Bankruptcy Judge Robert Gerber granted GM protection from a large number of liabilities by allowing it to split into “Old GM” and “New GM,” the news source explained. While the automaker accepted some liabilities into the new company, like those for warranty obligations and responsibility for post-2009 accidents that occur in pre-2009 cars, the majority of its liabilities stayed with the old GM. This means that new GM is not currently legally responsible for the loss of value on pre-2009 cars resulting from old GM’s alleged conduct.
Many legal experts believe that Judge Gerber is unlikely to undo a key part of the bankruptcy sale that he approved in 2009, but car owners may have a recourse, according to Reuters. With evidence emerging that at least some GM employees were aware of the problems with the ignition switches, the company is asking Gerber to make a clear ruling that it did not intentionally hide any knowledge from the bankruptcy court. Plaintiffs are arguing that GM hid knowledge of the defect, making a case for fraud.
Gerber has not been afraid to admonish GM in the past, Reuters noted. In a 2012 trial regarding the same bankruptcy, Gerber called revelations that the company disclose a payment of $367 million to certain hedge fund creditors “shocking.” Gerber’s decision in this high-profile case may set a precedent for further such bankruptcy filings.
- Practices: Corporate Transactions & Business, Bankruptcy & Creditors' Rights, Bankruptcy Litigation
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
BESS Project Agreements: Allocating Risk Among Developers, EPC Contractors, and Equipment Suppliers
Developers, engineering, procurement, and construction (EPC) contractors, and equipment suppliers each play a critical role in completing a BESS project. However, when equipment costs rise, deliveries are delayed, or regulations change, determining who bears the financial consequences can become contentious. Well-drafted project agreements are essential to sound risk allocation. Key Takeaways This article is Part […]
Author: Nicholas Wall
IP Infringement: What Steps Can You Take If You're Affected?
IP infringement occurs when someone uses your intellectual property without your permission or beyond the scope of the permission you granted. Common examples of IP infringement include copying a product’s patented features or using a trademarked logo in a way that is likely to confuse consumers about the source or affiliation of goods or services. […]
Author: Michael Mietlicki
Public Allegations, Unfinished Investigation: What New Jersey Businesses Should Do Next
When facing public allegations of wrongdoing, companies should not let the speed of the public conversation dictate the speed of an investigation. An investigation designed to confirm a preferred narrative rather than establish the facts can create serious problems later, particularly if litigation, regulatory scrutiny, or employment claims follow. Key Takeaways When public allegations surface […]
Author: Sean M. Pena
BESS Interconnection: Managing Grid, Cost, and Schedule Risk
For battery energy storage system (BESS) developers, securing equipment and site control is only part of the development equation. A project must also connect to the electric grid, and increasingly, BESS interconnection is one of the biggest sources of schedule, cost, and contractual risk. Key Takeaways This article is Part 3 of our Battery Storage […]
Author: Nicholas Wall
Navigating Director and Officer Liability in Times of Financial Distress
Director and officer liability increases sharply when a company is in financial distress. Decisions that would draw little attention in a healthy business can later be challenged by creditors, shareholders, bankruptcy trustees, and regulators as breaches of fiduciary duty, fraudulent transfers, or oversight failures. Understanding where that exposure comes from, and how to manage it, […]
Author: Michael Mietlicki
Before You Buy: Managing Real Estate and Permitting Risk for BESS Projects in New York and New Jersey
For developers pursuing battery energy storage system (BESS) projects, finding the right property is only the beginning. BESS site selection is as much a legal and transactional exercise as a real estate decision, with risk analysis central to the project’s ultimate success. Key Takeaways The core questions for BESS site selection in New York and […]
Author: Nicholas Wall
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.