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GM agrees to settlement over faulty ignition switches

Robert Burnson
Bloomberg

General Motors Co. agreed to a $120 million settlement over faulty ignition switches that allegedly caused cars to stall and air bags to deploy, in some cases triggering fatal accidents.

Employees leave the GM Lordstown Plant on November 26, 2018 in Lordstown, Ohio. GM said it would end production at five North American plants including Lordstown, and cut 15 percent of its salaried workforce. The GM Lordstown Plant assembles the Chevy Cruz.

The deal, which must be approved by a judge, would resolve hundreds of lawsuits filed before the automaker sought bankruptcy protection in 2009.

Under the settlement, which was filed Friday in federal court in Manhattan, GM will contribute as much as $70 million to drivers and in some cases their survivors.

A trust formed in connection with its bankruptcy will contribute $50 million, according to the settlement. GM also agreed to pay as much as $34.5 million to the lawyers who represented drivers in the court case.