Attorney General Laxalt and 49 States Reach $120 Million Settlement With General Motors Company Over Defective Ignition Switch

October 19, 2017

Carson City, NV – Today, Nevada Attorney General Adam Paul Laxalt, along with 49 states and the District of Columbia, announced a $120 million settlement with General Motors Company (GM). The settlement resolves a multistate investigation into the auto manufacturer’s failure to timely disclose known safety defects associated with ignition switch or key rotation related issues in several models and model years of their vehicles.

    In 2014, GM issued seven vehicle recalls in response to these unintended key-rotationrelated and/or ignition-switch-related issues that have affected over 9 million vehicles in the U.S. The recalls involved a defective ignition switch which, under certain conditions, could move out of the “Run” position to the “Accessory” or “Off” position, causing the driver to experience a loss of electrical systems, including power steering and power brakes. If a collision occurs while the ignition switch is in the “Accessory” or “Off” position, the vehicle’s safety airbags may also fail to deploy, increasing the risk of serious injury or death in certain types of crashes in which the airbag was otherwise designed to deploy.

      “This settlement demonstrates my office’s commitment to protect Nevada’s consumers from deceptive trade practices,” said Laxalt. “The public servants in my Bureau of Consumer Protection work diligently with other states to resolve national issues in a way that ensures safety for all consumers and provides clear guidelines to businesses.”

        The states alleged that certain employees of GM and General Motors Corporation, which went through bankruptcy proceedings in 2009, knew as early as 2004 that the ignition switch posed a safety defect because it could cause airbag non-deployment. Despite this knowledge, GM personnel decided these issues were not a safety concern and delayed making recalls. GM continued to market the reliability and safety of its motor vehicles which were equipped with this defective ignition switch.

          As a result of this settlement, Nevada will receive $1,461,846.54. In addition to the monetary payment, GM will be required to refrain from representing that a motor vehicle is “safe” unless it has 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; and 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. Additionally, 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.

            In addition to Nevada, other states and territories that participated in this settlement include: Alabama, Alaska, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Massachusetts, Maryland, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin and Wyoming.

              Chief Deputy Attorney General JoAnn Gibbs and Senior Deputy Attorney General Lucas Tucker of the Attorney General’s Bureau of Consumer Protection represented Nevada in this settlement.