Lawyers race to grab potential clients over recent GM recall

Article by Christian Andrei, on March 20, 2014

Lawyers trying to cash on consumers affected by General Motors’ recall of 1.6 million cars are scrambling to find potential clients. Their methods include buying Google search terms, registering Internet domain names, disclosing investigations into GM's behavior, and turning to their Twitter and Facebook accounts to provide updates on the recall.

"This is a race to the courthouse," remarked Bryan Quigley, a senior vice president at the Institute for Legal Reform. As of writing, at least two lawsuits have been filed, both claiming that GM tried to hide its knowledge of ignition problems from the public. Law firms that represent plaintiffs usually receive a percentage of the money their clients recover.

In litigations against Toyota Motor Corp. over unintended acceleration issues, lawyers for plaintiffs received $200 million in fees and $27 million in expenses in a settlement valued at $1.6 billion. The settlement was approved by a federal judge in 2013. GM issued in February a recall of around 1.6 million cars due to a faulty ignition switch that could turn off the engine, disable its airbags and make steering difficult.

The issue has been linked to 12 deaths, GM said. The recall has resulted to government criminal and civil investigations and an internal probe by GM as well as possible Congressional hearings.

All probes are wondering why it took GM so long to address an issue that it first knew n problem it has said in 2001. GM has apologized for how it handled the recall, adding that taking care of customers was its top priority. The carmaker disclosed that it is authorizing dealers to provide loaner cars and a $500 cash allowance to affected owners.

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