Passage of time may complicate claims for compensation
GM RECALL

GM victims bear burden of proof

Passage of time may complicate claims for compensation

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WASHINGTON -- General Motors has spent the past several months digging through its file cabinets and hard drives for 15 years' worth of records relating to its faulty ignition switch.

Now the burden is on accident victims and their survivors and lawyers to do their own detective work. And the trail of clues is going cold.

The victim compensation program that attorney Kenneth Feinberg outlined last week requires claimants to provide evidence that the defective switch played a role in the accident, such as the wreckage of a car, black-box data, service records or a police report.

But many of the crashes tied to the faulty ignition switch happened so long ago that those crucial records will have been lost or destroyed, meaning that potential claimants could be stymied in their effort to seek compensation -- and that the true scope and toll of the ignition mess may never be known.

"Here's the challenge," Feinberg told reporters here last week. "Unlike the 9/11 fund or the BP oil spill fund" -- which he also administered -- "many of these accidents occurred years ago. A decade ago."

This is yet another consequence of GM's long delay in recalling the switch used in small cars such as the Chevrolet Cobalt and Saturn Ion, which could easily be bumped out of the run position, cutting power to the airbags.

And it will present Feinberg with tough choices that will define the legacy of this case for GM by determining how much the fund costs, how long litigation lasts, how the company is treated by Congress and how many deaths and injuries are uncovered.

GM has linked 13 deaths to the defective ignition switches, as Automotive News reported in March. Victims' advocates say the final death toll could be in the hundreds.

The "official" tally that's etched into history books will emerge from a report that Feinberg said he will release once he finishes paying claims from GM's compensation fund.

But thanks to faded evidence, said Clarence Ditlow, executive director of the Center for Auto Safety, "the true death toll will never be known."

Feinberg said he consulted members of Congress, plaintiffs' lawyers and auto safety advocates in designing his program, and they sent him a clear message.

Sen. Richard Blumenthal, D-Conn., told reporters last week: "The benefit of the doubt should be given to victims. The presumption should be in their favor."

Feinberg told reporters that his team will help claimants find the documents to make their case. But what if the proof doesn't exist anymore?

For example, police have told Automotive News that records of two fatal crashes -- one from 2004 that GM has linked to the ignition switch recall and one from 2003 that may be linked -- were destroyed under department policy because of the length of time that had passed.

The paper trail
To draw from GM's compensation fund, a victim or a victim's family must demonstrate to Kenneth Feinberg that the faulty ignition switch played a role in a crash. Claimants have until Dec. 31 to come up with evidence, such as
• The wrecked car itself
• A police report on the crash
• Black-box data from a car's “event data recorder”
• Insurance company records
• Hospital records
• Crash-scene photographs
• Stalling complaints in warranty and maintenance records
• Depositions and expert witness accounts from prior court cases
Source: Feinberg Rozen

Police reports usually are held for at least five years, Ditlow said, but some jurisdictions shred them or stash them in archives after that.

Peter Henning, a law professor at Wayne State University in Detroit who has written about GM's ignition-switch defect, said: "It sounds easy: Just get documentation. Getting a police report from five years ago is sometimes easier said than done."

And dealers vary in their retention of service records, which would be relevant to Feinberg if a customer complained to a dealer about stalling before getting into a crash.

The survivors' challenge is clear to Daryl Chansuthus, whose 25-year-old daughter, Hasaya, died in a crash near Murfreesboro, Tenn., in December 2009.

Hasaya's 2006 Chevrolet Cobalt SS ran off the road that rainy night and collided with a tree. Her head hit the steering wheel unimpeded by an airbag, and she died of blunt force trauma.

The family sued GM a year later with a police report in hand, arguing that the airbags should have deployed but didn't. Within three months, GM had settled the case.

But for families who didn't quickly pursue legal claims, finding that sort of evidence "is going to be very difficult," Chansuthus said in an interview.

GM has put no cap on total compensation from the fund, hoping that claimants will accept cash payments and agree to drop lawsuits like the ones being filed by attorney Jere Beasley of Montgomery, Ala. Beasley said his firm has already filed four ignition switch lawsuits against GM and is about to file its fifth, in New York.

Kenneth Feinberg said his team will help claimants find documents to make their case.

Photo credit: BLOOMBERG

But, tellingly, all of Beasley's lawsuits stem from crashes in just the past two years. For each of those crashes, investigators were able to obtain black-box data. "The further you're looking backward," Beasley said, "the tougher it's going to be."

Applicants have until Dec. 31 to submit filings to Feinberg, and they retain the right to sue GM if they are unable to participate in the compensation fund or decide to decline what Feinberg offers them. They could face a higher burden of proof in court, as well as other hurdles, such as the liability shield that protects GM against claims relating to accidents before its emergence from bankruptcy in July 2009.

In the past, Feinberg has succeeded in keeping the vast majority of victims out of the legal system. Feinberg said his fund paid 97 percent of eligible victims from the Sept. 11, 2001, attacks and 92 percent of victims of the BP Gulf oil spill. For the Newtown, Conn., and Virginia Tech shootings and the Boston Marathon bombing, it was 100 percent.

In the case of GM, Feinberg acknowledged, "these are tough statistics to match."

Ryan Beene and Nick Bunkley contributed to this report.

You can reach Gabe Nelson at gnelson@crain.com.

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