GM and Chrysler Bankruptcies Causes Plight for Consumers

June 8, 2009

Consumer protection lawyers are in an uproar over the terms of bankruptcy that the Obama Administration is currently negotiating with General Motor Company and Chrysler. The proposed terms would extinguish all ongoing auto accident claims that blame a death or serious injury on a defect involving a GM or Chrysler vehicle.

This change would be very damaging to thousands of individuals and families who are waiting for their payouts from the company to pay for medical bills, funeral expenses, lost wages at work and physical and emotional damages.

Many lawyers have said that it is unusual that no money is being set aside in these bankruptcies for liability claims. They give the example of businesses that have to be shut down for producing asbestos- when they went bankrupt, a certain amount of money was set aside to pay for the medical expenses and necessary payouts.

The warranties issued by each company will be honored throughout the bankruptcy proceedings. However, if someone is injured or killed because of a manufacturing defect on the car- no damages will be paid out.