Last year, GM agreed to compensate victims killed or hurt when an ignition switch shut off accidentally and cut power to the brakes and steering, a defect hidden from the public for more than a decade, but the compensation fund covers only 2.59 million vehicles with that specific flaw, Bloomberg News reported on Thursday. GM says that a similar defect subsequently detected in an additional 10 million vehicles is ineligible for compensation because the company recalled the cars immediately after discovering the flaw and because employees made no efforts to keep it under wraps. At a congressional hearing last year, Sen. Richard Blumenthal (D-Conn.) encouraged Chief Executive Officer Mary Barra to expand the compensation fund to include more cars recalled for a defective ignition switch. Now, with fund administrator Kenneth Feinberg weeks away from wrapping up, Blumenthal says the omission is all the more glaring. GM spokesman Jim Cain said that the compensation fund’s scope is fair because the ignition switches excluded were a different design and discovered under different circumstances. Barra announced the compensation fund in June 2014 after GM came under fire from lawmakers for taking more than a decade to recall cars with switches that could be jogged accidentally into the off position. Worth as much as $600 million, the Feinberg fund gave victims and their families a route to seek compensation not available to them in the courts because GM has legal immunity from lawsuits related to accidents that occurred before the company emerged from bankruptcy on July 10, 2009. Victims of pre-bankruptcy crashes excluded by Feinberg can’t sue. Read more.
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