Judge won’t require GM, law firm to produce documents
General Motors Co. and its outside law firm King & Spalding do not have to turn over lawyer-client documents from previously settled ignition switch lawsuits to plaintiffs’ lawyers in pending cases, a federal judge in New York ruled Wednesday.
U.S. District Court Judge Jesse M. Furman said that while there is “probable cause” to believe GM committed a crime or fraud, the plaintiffs did not show that the documents at issue were made with the intent to further crime or fraud.
At issue was whether the automaker’s attorney-client privilege was exempted in crime-fraud cases.
Among the documents plaintiffs were seeking were those that related to advice GM may have received to settle three cases over a period from 2010 through 2013, according to the filing. Furman denied the motion that could have have required the parties to release potentially 91,000 pages worth of documents.
“As GM has said previously, the company did not conspire with King & Spalding to further any crime or fraud,” GM spokesman Jim Cain said in a statement.
Texas-based attorney Bob Hilliard, who is representing plaintiffs in a group of consolidated federal personal injury and death lawsuits against GM, was disappointed by the ruling. He thought he and his clients had a case to defeat the attorney-client privilege clause and pointed out that Furman in the ruling indicated plaintiffs may be able to prove in upcoming trials that GM “committed egregious acts for which it should be held to.”
“In January, we will try the first case against GM, and the jury, through its verdict, will now directly speak to GM’s behavior,” Hilliard said in a statement. “That verdict will determine what level of financial punishment should be assessed against this company for its conduct.”
King & Spalding also said it was pleased by Furman’s ruling.
“King & Spalding lawyers did exactly what one would expect ethical and diligent litigators to do on behalf of their client throughout the course of evaluating and defending individual accident claims,” said Micheline Tang, director of communications for King & Spalding, in a statement. “Judge Furman’s detailed analysis unequivocally confirms that view.”
Last year, GM recalled 2.59 million older Chevrolet Cobalts, Saturn Ions and other small cars for defective ignition switches that can move from the “run” position to the “off” or “accessory” position while driving, disabling air bags, power steering and brakes.
The company waited more than a decade to recall the vehicles, leading to the company in spring 2014 to agree to pay a $35 million fine to the National Highway Traffic Safety Administration and up to three years of monitoring to settle an investigation into the delayed recall. This fall, GM agreed to a $900 million deferred compensation settlement with the Department of Justice and three years of federal monitoring. That settlement ended a criminal investigation into the delayed ignition switch recall.
An independent compensation expert ultimately said the defect was tied to 124 deaths and hundreds of injuries. GM agreed to pay as much as $625 million to the victims and families of victims through the program.
The carmaker faces investigations by the Federal Trade Commission, Securities and Exchange Commission, Transport Canada and 50 state attorneys general. It also faces dozens of lawsuits.
Through mid-September, the ignition switch recall had cost GM more than $2.35 billion.