Consumers Seek Relief as Chrysler Bankruptcy Derails Lawsuits

Thursday, June 4, 2009

Consumers bringing personal-injury and product-liability lawsuits against Chrysler LLC and General Motors Corp. are pressing lawmakers in Washington to ensure that their cases get a court hearing or another form of compensation is found.
Consumer groups appealing a New York bankruptcy court’s May 31 ruling on the sale of Chrysler’s assets to an entity led by Italy’s Fiat SpA say it relieves the new company of responsibility for old losses. Plaintiffs and their families, organized by the non-profit Center for Justice and Democracy, are concerned that cases against GM may also be thrown out and are seeking congressional action.
“Either the bankruptcy system has to take care of victims or the Obama administration needs to come up with a victim’s fund much as we did in 9/11,” said Clarence Ditlow, executive director of the Center for Auto Safety, one of the groups appealing the Chrysler decision. Ditlow spoke at a press conference yesterday before plaintiffs and family members fanned out to congressional offices to make their case.
The Center for Justice and Democracy wants both automakers to purchase a retroactive insurance policy to cover past, present and future injury claims. Joanne Doroshow, executive director of the New York-based center, says Chrysler should create a $300 million fund and GM should establish an even larger one because of its size.

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