GM Might Have Broken Government Deal | News | HMG LLP

Lawyers Say G.M. Might Have Broken Government Deal

August 31, 2017

Car key in the ignition

Source: The New York Times by Barry Meier

Lawyers suing General Motors over a defective ignition switch sent a letter to federal prosecutors in New York on Thursday, saying that the carmaker might have violated the terms of a deferred-prosecution agreement it has with the Justice Department.

General Motors struck the deal last month to resolve a criminal case involving its failure to disclose the ignition switch defect, which is tied to 124 deaths.

As part of that agreement, G.M. agreed not to take any public positions contrary to the factual statements it made in the deal.

In a letter to Preet Bharara, the United States attorney in Manhattan, three law firms leading private lawsuits against G.M. — which have been consolidated in a New York federal court — said the carmaker might be in violation of the deal based on statements it had made in the lawsuits. Continue reading the main story Related Coverage

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The letter involves a potentially explosive issue — whether G.M. must divulge correspondence from its lawyers and outside firms like King & Spalding, which has defended G.M. in lawsuits involving the switch.

In recent weeks, lawyers for the plaintiffs and lawyers for G.M. have been jousting over whether the company will have to revise any of the positions it took previously in lawsuits.

General Motors has argued that all communications involving its lawyers and its outside law firms are protected by the attorney-client privilege. But plaintiffs' lawyers say those legal documents are now fair game because G.M. admitted that it had broken the law.

The attorney-client privilege is lost if it can be shown that a lawyer was aware that a crime was taking place or conspired to conceal one. When asked about Thursday's letter, G.M. issued a statement saying that it stood fully behind the statements it had made in the deferred-prosecution agreement, and that the filings discussed in the letter occurred well before that agreement was reached.

"The letter sent by the plaintiffs to the U.S. attorney's office and leaked to the media is misleading," the company said in its statement.

The letter on Thursday was sent jointly by three firms, Hagens Berman, Lieff Cabraser Heimann & Bernstein and Hilliard Muñoz Gonzales. It is the second time in recent weeks that lawyers have sought to use G.M.'s admissions last month against it in the private lawsuits.

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