GM faces bellwether trial over ignition switch injuries

People suing General Motors over a faulty ignition switch will get a chancein a Manhattan court this week to argue that the automaker should be held accountable for injuries, deaths and lost vehicle value.

Jury selection starts today in the second trial involving a car accident allegedly caused by the switch.

The trial could set the legal boundaries for dozens of lawsuits against GM. The proceedings could affect claims worth potentially billions of dollars over the defective switch, which can slip out of place, causing engine stalls and cutting power to airbags, brakes and steering systems.

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The defect, which some GM employees knew about for years, prompted the recall of 2.6 million vehicles in 2014 and has been linked to nearly 400 serious injuries and deaths.

A first trial involving ignition switch injuries ended abruptly in January following allegations that the plaintiff gave misleading testimony.

As the first trial never reached a verdict, the one starting today may be the first time a jury weighs in on whether GM is liable for its years-long failure to conduct a recall.

GM has already paid $2 billion in settlements and penalties over the defect, but this trial may set the tone for others claiming death or injury related to the switch who did not settle.

Ruling over pre-bankruptcy claims

A second legal ruling this week will determine how courts regard GM's liability for the period before its bankruptcy.

On Tuesday, in the same courthouse, plaintiffs suing over lost vehicle value and accidents that occurred before GM's 2009 bankruptcy will ask the 2nd U.S. Circuit Court of Appeals to reverse unfavourable decisions from a bankruptcy court last year.

They say the rulings could impact many of their claims under a sale agreement that largely freed "New GM" from burdensome liabilities that predate the bankruptcy.

Plaintiffs will argue that GM should face their claims because the company's deception deprived them of a chance to participate in the bankruptcy proceedings.

A lawyer for the plaintiffs, Steve Berman, said that had the U.S. government known about the defect during GM's bankruptcy, "The cars would have been recalled then, or the deal modified."