September 26, 2020

Lawyers say documents show GM ‘fraud’ and cover-up

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Michael-MillikinBy Sue Reisinger From Corporate Counsel

Lawyers in a Georgia lawsuit against General Motors Co. said at a news conference Monday that they have obtained documents contradicting Anton Valukas’ report and showing that GM was engaged in a “strong case of fraud” and a cover-up of its fatal ignition-switch problems.

The lawyers also said the role of former General Counsel Michael Millikin in the alleged cover-up is still being examined and will be subject to “further inquiry.” Millikin retired under pressure and was replaced by Craig Glidden on March 1. GM spokesman Jim Cain declined comment on the allegations.

The alleged cover-up reached a “high level,” according to Jere Beasley, and went well beyond the 15 former GM lawyers and other employees who were dismissed last year in the scandal. Beasley is founder of the Montgomery, Alabama, law firm Beasley, Allen, Crow, Methvin, Portis & Miles.

“GM will never try a lawsuit where the defective ignition is involved, in my opinion,” Beasley said, because he and other lawyers obtained documents “that make out a total case of product liability against GM and a very strong case of fraud. They will never let a jury hear it.”

Beasley said he couldn’t give specifics about the documents because they remain under a court seal and confidential. But most of them involve manufacturer Delphi Corp., which made the faulty switch to GM’s specifications.

He also said the lawyers obtained documents that contradict the report done for GM by Valukas, managing partner of Jenner & Block. “His report concluded that engineers legitimately believed this wasn’t a safety issue,” Beasley said. But the documents show “they knew it was, and ignored it for cost reasons.”

Valukas’ office said he was traveling and could not be reached for comment.

Pressed for details, Beasley added, “You could take the Delphi documents alone and make out a fraud case against GM. They intentionally covered up a known defect. And they threw the lower-level employees under the bus.”

Beasley continued, “Hopefully the government will continue to pursue this.” He was referring to an ongoing criminal investigation of GM by the U.S. Department of Justice.

Beasley and attorney Lance Cooper, of the Cooper Firm in Marietta, Georgia, spoke at a news conference Monday ostensibly to discuss the settlement last week of the Ken and Beth Melton case against GM. The Meltons’ daughter, Brooke, died in an accident caused by one of the switches. Terms of the settlement are confidential.

But Cooper used the occasion to also talk about state and federal cases against GM that are still ongoing, especially a big multidistrict litigation that is tentatively scheduled for trial in January. He said he believed the Melton documents would be used and made public during the other trials.

Cooper said if it hadn’t been for the Melton case, which uncovered that a faulty spring in the ignition switch had been secretly replaced in new units, without GM ever doing a recall on the old ones, the company might have kept secretly settling lawsuits over crashes.

But the Meltons fought to uncover the truth, he said, and GM had to admit its culpability before Congress, conduct millions of recalls and change its safety culture.

IMAGE: Michael Millikin Photo: Diego M. Radzinschi/NLJ

For more on this story go to: http://www.corpcounsel.com/id=1202720672485/Lawyers-Say-Documents-Show-GM-Fraud-and-CoverUp#ixzz3UeiaJmfo

 

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