Law360, New York (April 25, 2014, 8:20 PM ET) -- To succeed in the ever-growing ignition-switch defect litigation, General Motors Co. will have to outmaneuver a roster of dogged plaintiffs attorneys, including the players behind the lawsuit that pushed the automaker to expand its recent recall and a long-time industry foe who won a $128 million verdict against Ford Motor Co. in a Pinto fire case.
The ignition switch scandal behind the recall of more than 2.5 million GM cars has spurred more than 50 suits around the U.S. since March, but the work of some plaintiffs attorneys has been essential in shaping the contours of the intensifying litigation against GM. Although the automaker has maintained a contrite stance to the public, it has thrown a series of curveballs at plaintiffs by invoking its bankruptcy shield and insisting its recalled cars are safe to drive as long as the ignition key is not weighed down by extra keys or key fobs.
Some leading plaintiffs attorneys in particular have been fighting back by spotlighting the automaker's alleged fraud in covering up its fatal ignition switch defect for a decade, showing that the post-bankruptcy company continued to sell defective vehicles and imploring GM to pull recalled cars off the roads.
Mark Robinson of California-based Robinson Calcagnie Robinson Shapiro Davis Inc. earlier this week lodged a lengthy objection to GM's bid to invoke the bankruptcy shield to block claims by GM drivers who suffered economic damages because of defects in their vehicles.
"The bottom line is: These cars are not Mercedes or Cadillacs," Robinson said. "These are cars that the average working person is driving, and for them to lose even three or four thousand in value on their car is a big problem."
Robinson's decades-long career as a plaintiffs attorney includes historic wins against automakers, including a $128 million verdict against Ford for 13-year-old Richard Grimshaw, who suffered serious burns from a Ford Pinto fire in the 1970s.
Although a California court ultimately slashed the $125 million punitive damages component of the award to $3.5 million, his work on the case helped publicize a highly controversial cost-benefit analysis that Ford's engineers had used in the early 1970s to evaluate certain car safety standards that federal regulators had proposed at the time. The Grush-Saunby memo, as it was called, indicated that Ford may have made cost-benefit calculations by placing the cost of a fatality at $200,000, a number it based on social-cost estimates by the National Highway Traffic Safety Administration.
Robinson has now brought a number of proposed class actions against GM relating to the ignition switch defect, all of which argue that the defect and GM's attempts to conceal it have wrought economic losses to several owners of recalled cars.
GM's motion to the New York bankruptcy court that oversaw its Chapter 11 proceedings in 2009 did not address litigation arising from death or injury from the defective cars but sought to shield itself from liability from plaintiffs claiming economic losses, saying it does not bear legal responsibility for the conduct of its prebankruptcy iteration. Robinson is arguing that GM makes an arbitrary distinction between plaintiffs claims and violates fundamental bankruptcy principles of treating "equally situated" creditors the same way.
Another major focus for plaintiffs attorneys has been the scope of the ignition-switch recall. When GM first announced the recall, it isolated only pre-2009 cars as a problem, calling back 1.6 million models produced between 2003 and 2007.
But Roland Tellis, who co-manages Baron & Budd's Los Angeles office, was among the first group of attorneys to challenge GM's relatively narrow recall and brought the first suit implicating model years 2008-2010 Chevrolet Cobalts are in the crisis as well.
On March 25, Tellis brought the first suit targeting post-2009 models, along with Grant & Eisenhofer PA and plaintiffs attorney Lance Cooper, whose groundbreaking investigation last year with Florida-based engineer Mark Hood brought the ignition switch defect to light.
"It's just too easy for New GM to do what it has done and to say this is Old GM's problem," Tellis said. "But we knew that wasn't the full story."
Within days after that suit, GM expanded its recall to add 824,000 cars that could have faulty ignition switches. GM said about 5,000 of the defective switches may have been used to repair Chevrolet Cobalt and HHR, Pontiac G5 and Solstice and Saturn Ion and Sky cars made between 2008 and 2011.
One of the first personal injury suits brought since the recall was in Minnesota state court, involving the deaths in 2006 of two teenagers, Natasha Weigel and Amy Rademaker, who rode in a now-recalled Chevrolet Cobalt model that lost power, crashed and failed to deploy its airbags.
Robert C. Hilliard of Texas-based of Hilliard Munoz Gonzales LLP brought that suit after mid-March, observing that the police officer spotted the key in their car in the auxiliary position, rather than the run position, after the crash.
Hilliard then became a strident advocate for GM to park the recalled cars, latching onto CEO Mary Barra's remarks at congressional hearings earlier this month that she would warn GM owners to stop driving recalled cars if she has any evidence at all that the cars still fail with light ignition keys.
Hilliard argued to a Texas federal judge that his suits show such evidence, but GM countered that he had not provided reliable scientific data. U.S. District Judge Nelva Gonzales Ramos denied Hilliard's request earlier this month, saying that such an injunction would conflict with the directives of the NHTSA, which she said retains primary jurisdiction over the recall.
Hilliard said he is now fighting to discourage Judge Ramos from granting GM's wishes and transferring his suit to bankruptcy court.
"With big companies like this, the difficulty isn't the trial so much as getting to trial in the first place," Hilliard said. "During the process of getting to trial, the system favors the bigger corporations that have these big law firms at their disposal and an unlimited budget. But our reputation is that we won't back down, and we will do everything we can to take them to trial."