As Louisiana owners of General Motors cars are no doubt aware, GM recent recalled more than 1.62 million of its vehicles due to a problem with their ignition systems that has been implicated in at least 31 accidents and 12 deaths. The company now faces numerous investigations into its handling of the affair, and could face large fines if it is found to have delayed responding to reports of safety issues. Japanese automaker recently agreed to pay a record $1.2 billion in penalties to settle investigations into its actions in a safety scandal of its own.
General Motors recalled many of its models from the years 2003 through 2007 over concerns that the ignition could turn off while the car is running, which could lead to the power steering and air bags shutting off in an accident. Investigators from the National Highway Traffic Safety Administration believe that GM knew about the design defect in its ignition switch design for more than a decade before it took action this year.
In addition to government fines, GM could face lawsuits from injured consumers. The legal theory of product liability can hold automakers liable for injuries caused by their defective vehicles.
Product liability is a complicated area of the law and product liability lawsuits against huge multinational corporations can be very difficult. However, these lawsuits can help the injured to recover compensation for medical expenses and other damages they received in accidents caused by defective products. They are also important ways to hold companies accountable when they don't take safety seriously.
Source: Christian Science Monitor, "General Motors recall: How badly might it hurt GM's nascent turnaround?" Mark Guarino, March 19, 2014