GM Paid $495 Million in Suits
The automaker settled 297 cases involving fiery pickup crashes, a court document reveals.
By Myron Levin, L.A. Times Staff Writer
General Motors Corp. has paid out at least $495 million an average of more than $1.6 million per case to settle a series of lawsuits brought by victims of fiery crashes involving a popular line of pickup trucks.
The revelation of the payouts emerged late Tuesday, when a federal judge in Missoula, Mont., released an exhibit in a case brought by the estate of a family killed in a pickup accident.
The cases involved C/K pickups that had fuel tanks mounted outside the vehicles' protective frames. That made them prone to explode in crashes, critics say.
The dollar amounts in the document refer only to settlements reached before late 2000. It isn't clear how much GM has shelled out since then, though C/K pickup cases have been dwindling steadily as the trucks age and drivers replace them.
The document which The Times had asked the judge to unseal â€” provides a rare glimpse into the confidential settlements paid by a major corporation in a string of product liability cases. Typically, companies zealously guard such information from public view.
GM spokesman Jay Cooney criticized the judge's decision to release the exhibit. Cooney said that in unsealing the document, the judge had "set a dangerous precedent" that could encourage defendants to engage in protracted litigation rather than settle product liability claims.
"What we're left with is a decision that is just fundamentally poor public policy," Cooney said, "and ... from our standpoint it's very, very, very discouraging."
Cooney added that the number and size of the settlements did not mean that the C/K pickups were unsafe. Given the millions of C/Ks made, he said, "the vehicle has a tremendous safety record."
GM produced more than 9 million of the pickups from 1973 to 1987 with fuel tanks outside the frame. It then changed the design.
In court, GM had argued that releasing the data about the C/K pickup settlements would violate confidential agreements struck with the plaintiffs; make it more difficult to reach settlements in the future because plaintiffs would refuse to accept less; and harm GM's reputation.
But U.S. District Judge Donald W. Molloy concluded that the document in question doesn't reveal individual settlement amounts only an aggregate figure and an average. He also found that GM faced no "particular impediment to its ability to settle cases" if the information were divulged.
Finally, he asserted in his order that GM "certainly has the market presence and financial wherewithal to play the media game as well as anyone. The numbers themselves reveal no culpable or damaging information regarding GM. Therefore, disclosure of those numbers will cause no undue embarrassment of or damage to GM."
The document known as Exhibit 8 and carrying the heading "Byrd v. General Motors" was produced by GM in response to a demand for information from lawyers representing the plaintiff. Timothy, Darrell and Angela Byrd were killed in a fiery wreck of their C/K pickup.
The exhibit says in full: "There have been 297 settlements of lawsuits and claims involving 1973-87 C/K pickup trucks which resulted in 331 individual settlement agreements. The total amount paid in settlement to date is $495,076,104. This yields an average of $1,495,698 per individual settlement, or $1,666,923 per lawsuit/claim."
The Byrd case itself was settled in October 2000 for an undisclosed sum. At the time of the settlement, The Times asked Molloy to release Exhibit 8. After hearings, Molloy ordered the exhibit unsealed in January 2001. But GM appealed.
The 9th Circuit Court of Appeals overturned Molloy's order and remanded the case to the judge for further consideration.
On Tuesday, Molloy again unsealed the document in a ruling that sought to address issues raised by the 9th Circuit Court.
The tussle over the document began as The Times was researching a front-page story published in April 2001. The article focused on the fact that federal regulators, in exchange for a $51-million payment from GM earmarked for safety programs, dropped an investigation in 1994 that could have led to a recall of millions of C/K trucks. The failure to mount a recall followed hundreds of deaths in C/K pickup accidents and angered auto safety groups. They had long contended that, from a fire-risk standpoint, the C/K pickup was the most dangerous vehicle ever sold.
After the federal inquiry was dropped, The Times' investigation found, at least 65 people were believed to have burned to death in C/K crashes.
Cooney, the GM spokesman, said he believed that company lawyers late Tuesday had sought an emergency stay of Molloy's order so that the exhibit would remain sealed while GM again challenged the ruling before the appeals court. He said he did not know whether the company would appeal now that the document has been released.