Feinberg may seek GM switch-related cases in regulator files

Bloomberg News report

NEW YORK (Nov. 13, 2014) — The lawyer handling General Motors Co.'s compensation for victims of accidents tied to its faulty ignition switches said he'll consider an auto safety advocate's suggestion that he comb regulators' files for relevant accidents.

Kenneth Feinberg said he received the request Nov. 12 from Clarence Ditlow, executive director of the Center for Auto Safety, a Washington-based advocacy group. Mr. Ditlow said Mr. Feinberg should be processing claims faster and look at regulators' files for possible switch victims.

“I have read Mr. Ditlow's letter and have taken it under advisement,” Mr. Feinberg said Nov. 12 by email. “I want to make sure that the notice program and our outreach efforts reach the right people. We are considering Clarence's suggestions.”

Mr. Feinberg took issue with Mr. Ditlow's statement that he is handling claims too slowly, saying he had processed more than 800 requests for payment.

“We have processed every single claim that has been submitted to us with documentation,” he wrote. “All remaining claims — in the hundreds — have absolutely no documentation whatsoever.”

Confirmed deaths tied to defective ignition switches have reached 30 and may rise as new claims are filed before the December deadline set by the auto maker, he has said.

Mr. Feinberg, an attorney at Feinberg Rozen L.L.P. in Washington, D.C., has said about 150 unverified fatality claims are under review. Requests for payments might rise before the year-end deadline, he said.

$600 million

GM is reserving as much as $600 million to pay accident claims. Some lawyers have said that's not enough.

The number of fatalities tied to the switch defect has more than doubled from initial company estimates, based on claims approved so far by GM's compensation program. The fund represents the car maker's effort to settle out of court.

GM has said it faces more than 150 suits with demands for money for accidents or lower prices for cars with defects, and a proposed class-action lawsuit filed last month over value losses on 27 million cars recalled this year seeks $10 billion.

Mr. Feinberg has received about 1,500 claims, and he is working with people who filed about half of them to try to verify that the accidents resulted from switches, he has said. Customers are being asked to send all evidence, including photographs and black-box data, as he tries to find supporting material, he said.

The first claims were accepted Aug. 1.

An internal investigation this year showed that GM, for at least a decade, failed to promptly resolve complaints from consumers and dealers about abnormal crashes in the Chevy Cobalt and Saturn Ion, and that the company later replaced the faulty ignition switch without alerting the public or changing the part number as required.

The defective switches may be inadvertently shut off when jarred, cutting power to the engine and deactivating air bags.

This Bloomberg News report appeared on the website of Automotive News, a Detroit-based sister publication of Tire Business.