“New” GM – Sorry America, no help with your defective “Old” GM Cars

We first learned that when the Obama White House organized and implemented its special restructuring plan for GM and Chrysler, it failed to set aside money to pay wrongful death and injury lawsuits, leaving hundreds of Americans without recompense for suffering and injuries obtained because of defects in GM and Chrysler automobiles.

Now, it seems that “New GM” has no interest in recalling or repairing defects in vehicles manufactured and sold by “Old GM”:

General Motors Co. is seeking to dismiss a lawsuit over a suspension problem on more than 400,000 Chevrolet Impalas from the 2007 and 2008 model years, saying it should not be responsible for repairs because the flaw predated its bankruptcy.

The lawsuit, filed on June 29 by Donna Trusky of Blakely, Pennsylvania, contended that her Impala suffered from faulty rear spindle rods, causing her rear tires to wear out after just 6,000 miles.

Seeking class-action status and alleging breach of warranty, the lawsuit demands that GM fix the rods, saying that it had done so on Impala police vehicles.

But in a recent filing with the U.S. District Court in Detroit, GM noted that the cars were made by its predecessor General Motors Corp, now called Motors Liquidation Co or “Old GM,” before its 2009 bankruptcy and federal bailout.

The current company, called “New GM,” said it did not assume responsibility under the reorganization to fix the Impala problem, but only to make repairs “subject to conditions and limitations” in express written warranties. In essence, the automaker said, Trusky sued the wrong entity.

“New GM’s warranty obligations for vehicles sold by Old GM are limited to the express terms and conditions in the Old GM written warranties on a going-forward basis,” wrote Benjamin Jeffers, a lawyer for GM. “New GM did not assume responsibility for Old GM’s design choices, conduct, or alleged breaches of liability under the warranty.” (emphasis added)

So let’s see … “New” GM assumes all of “Old” GM’s assets, takes credit for “Old” GM’s legacy, employs most of “Old” GM’s employees, and honors all of “Old” GM’s union contracts.  But it declines to take responsibility for any of “Old” GM’s design or manufacturing problems.  My, how convenient.

And for those of you who would be quick to point out that such a scenario is rather common after corporate bankruptcy reorganization, please remember that this was not a typical bankruptcy.  The restructuring of GM’s debts and creditor obligations was specifically engineered by President Obama’s “Car Czar” Steve Rattner and his White House team, under the supervision of the Executive branch of the Federal government.

Once again, ordinary Americans were given the shaft so the UAW could benefit financially from the restructuring of GM.

Cronyism Runs Deep, in the Obama White House.

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