GM faulty-switch trial begins with claim of deadly cover-up

General Motors Co. found a deadly flaw in its ignition switches but chose to keep customers and regulators in the dark for years, a lawyer for an injured postal carrier told jurors in the first trial over the defect.

The company also rejected a cheap fix that would have saved lives, even labeling the defect a “convenience” issue rather than a safety problem to avoid a requirement to alert the authorities, plaintiffs’ attorney Robert Hilliard said Tuesday in his opening statement in Manhattan federal court.

“You have to understand the effect and consequences of an actual conscious decision by General Motors to put a defective switch in millions of cars,” Hilliard told the jury. He said the evidence would reveal “the cover-up and the fraud” that spanned more than a decade and ruined lives.

Robert Scheuer, 49, whose 2003 Saturn Ion ran off an Oklahoma highway and smashed into a tree in May 2014, is the first plaintiff to have his case heard by a jury. He claims a defective switch caused the air bag to fail, leaving him with neck and back pain. Defective switches have also been shown to cut the power-assist to brakes and steering, leading to deadly stalls.

Scheuer’s is also the first of six bellwether trials in Manhattan, so called because they are used to test strategies. The jury’s reaction to the evidence may push either side to settle – or battle out – hundreds of other cases and help set the size of any settlements.

“There were mistakes and errors in judgment made by General Motors,” GM’s lawyer, Mike Brock, said in his opening statement. He said that 15 employees were eventually fired by the company and new safety programs and measures were put in place. GM won’t deny mistakes were made, the attorney said.

The carmaker’s strategy became clear in court as Brock noted that Scheuer failed to act on a GM recall notice sent a month before the accident. Brock also described the driver’s history of back problems and surgeries, the painkillers he was taking, and the possibility that he simply fell asleep behind the wheel and drifted off the road.

Injury evidence

GM’s attorney also cast doubt on Scheuer’s claim to have been unconscious for about three hours after the impact, citing evidence of mobile-phone usage during that time and an absence of head injuries. Scheuer was flown from the accident scene by helicopter but was discharged from the hospital the next day “with no obvious injuries,” Brock said.

The police officer who arrived on the scene determined the driver “potentially fell asleep or stopped paying attention,” based on the angle of the car’s departure from the road, Brock said.

GM, which has already paid more than $2 billion to resolve investigations, a securities lawsuit and injury claims, now faces at least 16 trials in 2016 on death and injury claims in U.S. state and federal courts. It has said in regulatory filings that it couldn’t estimate its potential liability.

Hilliard says his client missed 169 days of work, can’t lift more than 20 pounds and needs surgery.

One man

“One man was involved in an accident in Oklahoma, but he is not the only person who has been a victim,” Hilliard said.

Hilliard held out his hand to show jurors the tiny part of the switch at the center of the defect called a detent plunger, which clicks the ignition between the “run” and “accessory” positions deep inside the switch. GM in 2001 made the part even smaller to improve the “feel” of the ignition, but ended up creating a deadly flaw, Hilliard said.

GM eventually sought a replacement part but chose to deplete its existing defective switches and didn’t alert authorities, the attorney said.

As with any lawsuit alleging a product defect, each plaintiff must show that the incident and injuries or fatalities were connected to the flaw. “Each bellwether case will be tried on its own merits,” Jim Cain, a GM spokesman, said in a statement before the trial.

GM engineers and lawyers knew about the bad switches for years before the recall, according to a 2014 study commissioned by the company, America’s biggest automaker. The switch could be jarred into the “accessory” position, shutting off the engine, disabling power steering and brakes and preventing air bags from deploying. GM, which got a $50 billion government bailout in the financial crisis, rejected a fix that would have cost 90 cents apiece, according to evidence provided to lawmakers.

Federal probe

In the weeks before the trial, U.S. District Judge Jesse Furman issued rulings in favor of Scheuer, allowing his lawyer to tell jurors of GM’s admission of fault in its settlement of a federal criminal probe. The company admitted it failed to disclose to regulators that it was aware of a flaw and “falsely represented to consumers that vehicles containing the defect posed no safety concern.’’ The faulty switch has been linked to the deaths of at least 124 people and to injuries ranging from broken bones to paralysis.

“This isn’t mid-level management” the lawyer said. “This is a conscious decision up the food chain from those who are charged with advising the company.”

Downed tree

Hilliard said that after Scheuer ran over “rumble strip” on the side of a highway to avoid a Mustang that cut him off, the switch on his car fell out of place, disabling electrical systems including the air bag as he went airborne at 45 miles an hour. The lawyer showed jurors blown-up photos of the vehicle crumpled against two trees, including one that was knocked over by the force of the impact.

General Motors doesn’t concede any responsibility for Scheuer’s accident and injuries, Cain said in the statement.

“GM will show the ignition switch did not rotate and the air bags were not designed to deploy in this accident,’’ he said.

The case is Fleck v. General Motors LLC, 1:14-cv-08176, U.S. District Court, Southern District of New York ((Manhattan).