GM settles defective ignition switch lawsuit for $120 million; Indiana to get $2.1 million share

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US Senator Edward Markey (R), D-Massachusetts, holds up a faulty General Motors ignition switch during a press conference with the family members of deceased drivers on Capitol Hill in Washington, DC, April 1, 2014, ahead of a House Energy and Commerce Committee hearing with the General Motors CEO. General Motors Chief Executive Mary Barra faces tough questioning in Congress on Tuesday over why the company ignored a faulty ignition problem for a decade despite numerous accident reports and 13 deaths. Also in the dock will be the US auto safety agency, the National Highway Traffic Safety Administration (NHTSA), under attack for not acting on its own evidence that the ignitions posed dangerous risks to drivers. AFP PHOTO / Jim WATSON (Photo credit should read JIM WATSON/AFP/Getty Images)

INDIANAPOLIS, Ind. – The state of Indiana will receive a nearly $2.1 million cut of a $120 million settlement involving defective ignition switches from General Motors.

The attorneys general from several states and GM announced the settlement Friday. In 2014, GM launched a series of recalls involving 9 million vehicles that had trouble with the ignition switches, which could slip from the “run” position to “off,” shutting down the engine and electronics inside the car. If a crash were to occur, the airbags could fail to deploy.

The defective switches were blamed for at least 124 deaths and 275 injuries. Forty-nine states and the District of Columbia sued the company over the switches, accusing the automaker of violating consumer protection laws. Arizona was the only state that elected not to participate in the suit.

The lawsuit alleged that GM and high-level employees knew about the problem as early as 2004 but waited for years to recall its vehicles. All the while, the automaker marketed its cars as safe and reliable.

According to Indiana Attorney General Curtis Hill, General Motors agreed to several terms. The company shall:

  • Not represent that a motor vehicle is “safe” unless they have complied with the Federal Motor Vehicle Safety standards applicable to the motor vehicle at issue.
  • Not represent that certified pre-owned vehicles that GM advertises are safe, have been repaired for safety issues, or have been subject to rigorous inspection, unless such vehicles are not subject to any open recalls relating to safety or have been repaired pursuant to such a recall.
  • Instruct its dealers that all applicable recall repairs must be completed before any GM motor vehicle sold in the U.S. and included in a recall is eligible for certification and, if there is a recall on any certified pre-owned vehicle sold in the U.S., the required repair must be completed before the vehicle is delivered to a customer.

The settlement brings a conclusion to the multistate investigation into GM’s handling of the ignition switch issue, according to Hill’s office.