Lawyer Kenneth Feinberg set to calculates recall-related damages at GM

Article by Christian A., on April 23, 2014

Kenneth Feinberg, a lawyer tapped by General Motors to explore ways to face legal and civil obligations with regards to the current recall crisis, may soon commence calculating the damage done by faulty ignition switches in GM’s cars.

General Motors is asking a bankruptcy judge in New York to confirm its shield from liability lawsuits linked to crashes or defects that took place before its bankruptcy – a move that would render the process of compensating crash victims' families as well as car owners faster, simpler and cheaper.

Feinberg managed the fund for the victims of the September 11, 2001, attacks, and the BP oil spill in the Gulf of Mexico and the Boston Marathon bombing. Feinberg told CNBC in an interview last week that his impression was that GM was asking him to develop a program that might be employed to compensate eligible claimants against the carmaker.

He stated that issues like how much money should be dedicated to the effort and how damages would be calculated remains unknown. Sen. Richard Blumenthal, D-Conn., has urged GM to "do right by these victims” and establish a compensation fund that will “make them whole."

If GM follows the advice, it would be a first for an auto-defect case, remarked Kyle Logue, a professor at the University of Michigan Law School who specializes in tort and insurance law. He said that such move would be good public relations for GM, adding that and it could help the bottom line if it could reduce lawsuits.

Logue noted that unlike lawsuits, compensation fund is certain and is “over relatively quick." GM is expecting to take a $1.3 billion charge on its first-quarter earnings for costs related to the recall.

Brian Johnson, an analyst with Barclays Capital, said in a report in March that GM's recall-related costs could surge to between $2.5 billion and $3.5 billion, including a potential compensation fund. [source: automotive news - sub. required]

If you liked the article, share on:

Comments

Recommended

We’re willing to bet that the Bentley Bentayga is not the first thing that comes to mind for most people who are into off-roading and outdoor activities. It just doesn’t...
by - November 23, 2017
The other day, it was confirmed that Volvo will finally bring the XC40 to US soil, where it will first make an appearance at the 2017 Los Angeles Auto Show....
by - November 23, 2017
There is no question that the new BMW M5 (F90) high performance sports sedan is more powerful, faster and more enticing than the previous model. But for interested customers in...
by - November 23, 2017
Following the Tesla Roadster’s electrifying revelation on Thursday, Musk’s highly ambitious goals have skyrocketed when he tweeted about his future plans for the new sports car. Well, kind of. The...
by - November 23, 2017
Earlier in November at the 2017 SEMA Show in Vegas is when Hennessey unwrapped the Venom F5 to all of us. But it was actually first introduced as a concept...
by - November 22, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries