GM Reaches Settlement

 

General Motors announced that they have reached a criminal settlement to end the current government investigation of their faulty ignition switches. GM will pay $900 million for the Department of Justice fine incurred.

Additionally, GM has reached a resolution with over half of the death and personal injury lawsuits that are a part of the current multidistrict litigation through the U.S. District Court for the Southern District of New York. General Motors also settled in a shareholder class action lawsuit filed in the U.S. District court in Michigan for two civil lawsuits. The total for these settlements will set GM back another $575 million.

GM’s ignition switch defect caused cars to suddenly turn off when driving, most notably when the car was jostled from uneven road conditions. As well as an engine shutdown, power steering and power brakes were disabled and the airbags became deactivated. This led to numerous car accidents with severe injuries and deaths.

The MDL and shareholder class action settlements resolve about 1,380 death and personal injury lawsuits in total. GM did not release the individual settlement values paid in the various settlements.

The remaining lawsuits in the multidistrict litigation include economic loss claims, 370 injury lawsuits and 84 death lawsuits. Prior to Thursday’s announcement, GM had already agreed to offer ignition switch settlements to 124 families in death lawsuits and another 275 who were injured.

The nearly $1.5 billion GM is faced with in fines and settlements so far for the defect does not include the cost of fixing the 2.6 million vehicles that have been recalled due to the GM ignition switch defect.

Some consumers oppose how the situation was handled under the law. The Justice Department was criticized for not bringing charges against individual GM employees who were believed to have direct responsibility. In general, this criticism has extended to the DOJ in general for going after companies in general rather than prosecuting individuals for their wrongdoing.

When the GM scandal first came to light over a year ago, the company fired 15 employees for failing to resolve the ignition switch problem.

As it stands, there is no law that deals with criminal penalties for auto makers failing to disclose safety problems, so broader laws such as wire fraud and false statements are used.

According to court documents, GM knew of the ignition switch problem a decade ago in 2004 and 2005. Rather than making a simple and inexpensive change in the part at the time, which was estimated to cost approximately a dollar per vehicle, the situation was overlooked.

U.S. Attorney Preet Bharara summarized the situation, “”They let the public down. They didn’t tell the truth in the best way that they should have — to the regulators, to the public — about this serious safety issue that risked life and limb.”

CVS Does It Again!



Alabama Supreme Court on Friday allowed a class action lawsuit seeking more than $3 billion to go forward against CVS Health Corp and several insurance companies, agreeing with the ruling by a lower court which said the plaintiffs could be certified as a class.

 

The case dates back to a 1999 class action settlement for $56 million over alleged accounting fraud at MedPartners, a physician and pharmacy benefits management corporation.

 

CVS Health could not be reached for comment.

 

MedPartners became Caremark and merged in 2007 with CVS, now known as CVS Health.

In 2003, Alabama attorneys filed a lawsuit on behalf of a stockholder John Lauriello, alleging fraudulent insurance information was given in court by MedPartners and its insurers.

The plaintiffs allege that MedPartners and its insurers hid the fact that unlimited insurance coverage was available at the time of the initial class action in 1998, enabling them to settle for $56 million, instead of $3 billion in stockholder losses, according to court documents.

$190 Million John Hopkins Settlement For Pelvic Exam Lawsuits



Johns Hopkins Hospital has agreed to pay $190 million to settle a class action filed by about 3800 women who were secretly videotaped during gynecological examinations by a doctor, Nikita Levy, who was a staff member at the hospital. The preliminary settlement, approved by Baltimore City Circuit Court Judge Sylverster Cox is believed to be the largest settlement of this sort.

Nikita Levy killed himself in Feb. 2013, two weeks after an employee of the hospital told higher-ups at Johns Hopkins about a penlike device Dr. Levy wore around his neck during patient examinations that she believed to be a camera. While Johns Hopkins did not admit to wrongdoing, it did say in a statement it believes the settlement is “fair and properly balances the concerns of thousands of Plaintiffs with the obligations the health system has to provide ongoing and superior care to the community.”

After receiving the insider tip, Johns Hopkins Hospital security searched Dr. Levy’s office and uncovered several of the penlike devices. Baltimore County police also stormed his home with search warrants and uncovered multiple data storage servers suspected of housing explicit depictions of his patients. The class action suit filed last fall alleged that the institution failed to “discover, stop and report” Dr. Levy because its staff was not trained to recognize and report perverse conduct and patients were not offered the option of having a chaperone present during examinations and procedures. It was also alleged that the institution failed to investigate properly reports of misconduct.