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From Products Liability Law Daily, June 30, 2014

GM releases protocol for resolving ignition switch defect claims

By Susan Lasser, J.D.

General Motors (GM) has issued a compensation protocol outlining the eligibility and process requirements for individual claimants to submit and settle claims alleging that the ignition switch defect, which has been the subject of recent GM recalls, caused a death or physical injury in an automobile accident. The plan was announced today by Kenneth R. Feinberg, Administrator of the GM Ignition Compensation Claims Resolution Facility. In other company news, GM also announced its recall of approximately another 8.5 million vehicles, model years 1997 to 2014 (see story, “GM recalls 8.5 million vehicles, bringing total for 2014 to 25 million,” under News below).

Mr. Feinberg explained many of the features of the compensation program in a press conference. Notable is that the program has no aggregate cap. According to a GM press release, the program is voluntary, and only if an individual is satisfied with the compensation provided does that person agree to waive his or her rights to litigate against GM. In addition, Mr. Feinberg retains complete and sole discretion over participation in the program and over all compensation awards to eligible victims. GM cannot reject Mr. Feinberg’s final determinations on eligibility and compensation amounts. Persons who settled their claims with GM before they knew of the ignition switch defect will be allowed to enter the program and could receive additional compensation. Another feature of the program is that it will not examine or evaluate any contributory negligence (e.g. intoxication or speeding) attributable to the driver of the vehicle at issue.

GM has authorized that only eligible claims involving death or physical injury will be processed, and that no other claims for economic injury or other allegations of damage are subject to the protocol.

Eligible claims. The protocol states that claimants must meet certain eligibility requirements, including that the individual on whose behalf a claim is filed must have been the driver, a passenger, a pedestrian, or the occupant of another vehicle, in an accident involving an “eligible vehicle.” Eligible vehicles are listed in the protocol and include the Chevrolet Cobalt (model years 2005-2007; 2008-2010), the Saturn Ion (model years 2003-2007), and the Pontiac Solstice (model years 2006-2007; 2008-2010), among many others.

In addition, the accident at issue must have occurred prior to December 31, 2014. Also, an individual claim will be “deemed ineligible if the facts and circumstances of the accident demonstrate the deployment of any airbag during the accident and/or the deployment of seatbelt pretensioners during the accident.”

Claimants who file a claim with Mr. Feinberg must prove that the ignition switch defect in an “eligible vehicle” was the “proximate cause” of the death or physical injury in the accident. The protocol sets forth 3 categories of eligible claims—individual  death claims, individual claims involving more serious physical injuries (e.g. quadriplegic and paraplegic injuries and permanent brain damage), and less serious physical injuries involving hospitalization or, in limited circumstances, immediate outpatient medical treatment. The protocol states that claims for physical injury must provide contemporaneous documentation of either overnight hospitalization or outpatient medical treatment within 48 hours of the accident.

Compensation tracks for individual death claims. For the individual death claims, the protocol lays out two compensation tracks: Track A, or the “Presumptive Compensation” track, relies on a combination of the decedent’s historical earnings and personal details with assumptions of likely future events based on publicly available national data; while Track B, or the “Complete Economic Analysis” track, involves a complete, comprehensive economic loss analysis of the decedent’s past, present, and assumed future income. For either track’s economic loss compensation calculation, however, each “eligible claimant” submitting a death claim also will receive uniform amounts for noneconomic losses in the following amounts: $1,000,000 for the death of the decedent, $300,000 for the surviving spouse, and $300,000 for each surviving dependent of the decedent.

Further eligibility requirements. The protocol sets forth the methodologies for calculating compensation as well as the documentation requirements necessary for a claim’s consideration. Eligible claims will be paid within 90-180 days from the time that a submitted claim is deemed “substantially complete” by Mr. Feinberg. The effective date of the protocol is August 1, 2014, which is when relevant claim forms will be available. Claims can be submitted to Mr. Feinberg beginning August 1, and must be postmarked no later than December 31, 2014 for consideration.

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