GM agrees to take responsibility for future liability claims.
The AP (6/28, Fowler) reported General Motors "has agreed to take on responsibility for future product liability claims, removing what could have been a sizable roadblock" on the company's way to a "quick sale of its assets" and emergence from bankruptcy. GM "wants to sell the bulk of its assets to a new company and leave behind unprofitable assets and other liabilities such as product-related lawsuits." But in a "concession to consumer groups and state officials who had threatened to block the sale because of product liability concerns, the new company will now assume responsibility for future claims involving vehicles made by the old company."
The Wall Street Journal (6/29, A4, Spector) reports that the agreement "represents a partial victory for more than a dozen state attorneys general and several consumer-advocacy groups."
The Washington Post (6/29, Tse, Marr) reports, "Those with past claims would have to pursue the GM left behind in bankruptcy with nothing but unwanted assets, debts and other liabilities. That means these consumers are likely to recover little, if anything." On Friday "Rep. André Carson (D-Ind.) introduced legislation that would require automakers to purchase liability insurance if they are owned by the federal government or have federal loans. This insurance must protect against past and future claims, even after a bankruptcy filing." Bloomberg News (6/28, Lui) also covered the story.
The New York Times (6/28, A20, De La Merced) reported GM and the Obama Administration's auto task force "have been negotiating with more than a dozen state attorneys general who have objected" to GM's asset sales plan.
The Washington Post (6/27, Dennis, Tse, Marr) reported earlier on the talks leading to the agreement.