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Bankruptcy Judge Robert Gerber told General Motors Co. six years ago it didn’t have to worry about lawsuits over cars made before its $49.5 billion government bailout, Bloomberg News reported yesterday. Last month, the same judge said he wasn’t so sure anymore. Judge Gerber expressed doubts about his decision, saying that it might allow GM to get away with alleged misconduct tied to an ignition switch defect in some cars. GM may have acted “very badly” in delaying recalls of cars it knew might be dangerous, Judge Gerber said at a hearing in New York Feb. 17. The judge said at the time that he’s deciding how to “fix” his 2009 ruling, and that he may take more than a month to do it. At least 74 people were killed when GM cars suddenly turned off after the ignition was jostled. More than 2.59 million vehicles have been recalled for just one type of switch defect. Affected car owners who weren’t injured sued Detroit-based GM, seeking compensation for their vehicles’ loss in value. If Judge Gerber rules bankruptcy doesn’t protect GM from such value claims for cars made before 2009, GM may face as much as $10 billion in potential liability over the scandal, plaintiff lawyers have said.

Bankrupt chemical company Freedom Industries pleaded guilty yesterday to three pollution charges related to last year's spill that contaminated a West Virginia river, The Associated Press reported yesterday. Mark Welch, chief restructuring officer of Freedom Industries, entered the plea on behalf of the company in federal court to negligent discharge of a pollutant and unlawful discharge of refuse matter, both misdemeanors, and violating a permit condition under the Clean Water Act, a felony. Thousands of gallons of a coal-cleaning agent from Freedom Industries in Charleston spilled into the Elk River and went into West Virginia American Water's intake 2 miles downstream on Jan. 9, 2014. It prompted a tap water ban for 300,000 residents in nine counties for up to 10 days while the water company's system was flushed out. Freedom Industries, which filed for bankruptcy eight days after the spill, faces a maximum $900,000 fine. Sentencing was set for June 29.

While General Motors has settled one potentially explosive lawsuit related to defective ignition switches, the company still faces the possibility of depositions of its employees in a broader class-action case, the New York Times reported today. A number of current and former GM employees are scheduled to be questioned under oath, beginning in May, in a sweeping case in federal court in New York. GM avoided depositions in the wrongful-death case settled last week with the parents of Brooke Melton, 29, a Georgia woman who was killed in a crash in a Chevrolet Cobalt equipped with a faulty ignition switch. But the lawyers who represented Melton’s parents said yesterday that legal efforts to collect internal GM documents and depose employees would continue nonetheless. The lawyers said that the discovery process begun in Ms. Melton’s case had accelerated similar efforts in the so-called multidistrict litigation, which consolidates a number of lawsuits for injury and death cases, as well as economic losses sustained by owners of defective vehicles. http://www.nytimes.com/2015/03/17/business/gm-will-face-further-discovery-in-broader-class-action-case.html?ref=business

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Two former owners of Freedom Industries pleaded guilty yesterday to environmental violations stemming from last year's Charleston chemical spill that prompted a temporary tap water ban for 300,000 residents, the Associated Press reported yesterday. At separate hearings, William Tis and Charles Herzing entered the pleas to causing an unlawful discharge of a coal-cleaning agent into the Elk River. Each faces up to a year in prison when sentenced June 22. They also face fines of $25,000 per day per violation, or $100,000 — whichever is greater.

General Motors Co. investors urged a judge to let their lawsuit proceed against the automaker’s board, which they say was asleep at the switch while the company produced cars with faulty ignition systems that led to fatal accidents, Bloomberg News reported yesterday. More than a dozen current and former GM directors failed to adequately oversee the company’s operations for about three years starting in 2010 and had no system to ensure that the Detroit-based company produced safe vehicles or reported problems to government regulators, Peter Safirstein, a lawyer for pension funds suing GM, told a Delaware judge yesterday. “What we had here is a total systemic failure to supervise that amounts to a conscious dereliction of duty,” Safirstein told Delaware Chancery Court Judge Sam Glasscock III at a hearing in Georgetown, Del. Confirmed deaths tied to GM’s defective ignition switches stand at about 50, four times more than the company estimated through much of 2014, according to a January report by Kenneth Feinberg, a lawyer hired by GM to oversee an out-of-court compensation fund for recall victims. Last year, GM said in regulatory filings that it had recalled 34 million vehicles worldwide through September and spent $2.7 billion on repairs, loaner cars and other costs of the call-ins.

In a blow to the Archdiocese of Milwaukee in its ongoing bankruptcy, a federal appeals court yesterday put a $60 million cemetery trust fund back in play to potentially settle claims related to sexual abuse by priests, the Milwaukee Journal Sentinel reported today. The ruling from the U.S. Court of Appeals for the Seventh Circuit said that the church cannot use the First Amendment or a 1993 law aimed at protecting religious freedom to shield the funds. The court also said the judge who put the money off limits, U.S. District Judge Rudolph Randa, should have disclosed the fact his parents and other relatives are buried in a cemetery maintained by the trust fund. The court remanded the case to a different district judge.

Bankruptcy Judge Terry Myers yesterday approved a $21 million plan to compensate about 380 people who allege they were sexually abused by the clergy of Montana’s Roman Catholic Diocese of Helena, the Wall Street Journal reported today. Judge Myers had been widely expected to sign off on the plan, which drew no objections and was approved by more than 98 percent of the alleged victims when put to a vote earlier this year. The plan will settle about 380 sexual-abuse claims brought against the Helena diocese, 235 of which were filed jointly against both the diocese and the Ursuline Sisters of the Western Province, a religious order of nuns. The settlement also resolves the claims against the Ursuline Sisters. The judge’s signature also clears the way for the diocese to exit chapter 11 protection later this year.

The West Virginia Senate on Friday passed Senate Bill 411, which creates the Asbestos Bankruptcy Trust Claims Transparency Act and the Asbestos and Silica Claims Priorities Act, the Huntington (W. Va.) News reported on Saturday. The bill, which was sponsored by Senator Tom Takubo (R) establishes legal standards and procedures for the handling of certain asbestos and silica claims. Additionally, the bill establishes medical criteria procedures, statute of limitations standards, and requires disclosure of existing and potential asbestos bankruptcy trust claims. “As a pulmonary doctor, I’m pleased that the Senate voted today with full bipartisan support to protect funds for West Virginians who are affected by asbestos-related injuries,” Senator Takubo said. “We must ensure funds are healthy five to 10 years from now to help pay for medical bills and family expenses, and this legislation will allow us to do that.”

The Archdiocese of St. Paul and Minneapolis plans to sell its chancery office and three other properties to help pay creditors in bankruptcy, chief financial officer Tom Mertens told a creditors' committee meetingon Tuesday, according to MPRNews.org yesterday. He estimated the properties could be sold for "maybe a max of around $11 million" but said the archdiocese hasn't determined the exact amount. The Archdiocese of St. Paul and Minneapolis filed for bankruptcy protection in January amid more than a hundred claims by people who said they were sexually abused by Catholic priests.