US Supreme Court Rejects GM Appeal On Parking-Brake Lawsuit
January 12 2009 - 10:28AM
Dow Jones News
The U.S. Supreme Court refused Monday to consider General Motors
Corp.'s (GM) appeal of an Arkansas judge's decision to certify a
nationwide class-action lawsuit against the automaker over
allegedly defective parking brakes.
GM argued that the trial judge allowed the case to proceed as a
class action without any understanding of what facts and issues
that would be relevant in the case.
The automaker, backed by business groups, said the issue of
class-action certification is important because once plaintiffs are
cleared to join together and sue as a class, companies face higher
financial liability and are under pressure to settle even
unmeritorious claims.
At issue is a lawsuit about potentially faulty parking brakes on
four million GM trucks and sport-utility vehicles from model-years
1999 to 2002.
The plaintiffs allege that GM knew of the parking-brake problem
and attempted to cover it up in order to avoid paying to fix
it.
They said in a court brief that it would cost GM $350 million to
fix all the affected vehicles.
The Supreme Court rejected GM's appeal without comment and let
stand an Arkansas Supreme Court decision affirming the class-action
certification.
GM said in a November filing with the SEC that it has been named
in four class-action lawsuits on parking brakes, including two in
Canada. The company said the Canadian suits seek punitive and
general damages of $500 million.
-By Brent Kendall, Dow Jones Newswires; 202-862-9222;
brent.kendall@dowjones.com
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