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gm faces massive class-action lawsuit over transmission failures

2024-09-01

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washington (reuters) - a u.s. appeals court ordered general motors to face a class-action lawsuit that claimed it violated laws in 26 states by knowingly selling hundreds of thousands of cars, trucks and suvs equipped with faulty transmissions.

a three-judge panel of the u.s. court of appeals for the sixth circuit issued the ruling on aug. 28. the court said a lower court judge had the authority to allow a class-action lawsuit filed by drivers of cadillac, chevrolet and gmc vehicles from model years 2015 to 2019 equipped with either the 8l45 or 8l90 eight-speed automatic transmissions.

the lawsuit involves approximately 800,000 gm vehicles, including 514,000 certified vehicles, including the cadillac cts, ct6 and escalade; chevrolet camaro, colorado, corvette and silverado; and gmc canyon, sierra and yukon.

drivers said the vehicles shuddered in high gear and jerked in low gear, even after repairs, and they accused gm of requiring dealers to assure customers that violent judders during gear changes were "normal."

in opposing class certification, gm said most class members had never experienced the problems in question and therefore had no standing to sue. gm also added that the problems among class members were too diverse to justify a class action.

however, circuit judge karen nelson moore said the exorbitant amounts drivers paid for the allegedly defective vehicles gave them standing to sue. she added that “exactly how and to what extent each individual plaintiff experienced the judder or shift quality issue” was irrelevant to whether gm concealed a known defect or whether drivers thought the information was important. the court also rejected gm’s argument that many potential claims should fall within the scope of arbitration.

the case has been sent back to u.s. district court judge david lawson in detroit, michigan, who approved the class action lawsuit in march last year. ted leopold, a partner at cohen milstein sellers & toll and a lawyer representing the drivers in the class action lawsuit, said in a statement: "we look forward to holding gm accountable before a michigan jury."

class action lawsuits can result in greater damages at a lower cost than if plaintiffs were forced to sue individually.

the case was heard by the united states court of appeals for the sixth circuit, in which the general motors driver was the plaintiff and general motors llc was the defendant. the case number was 23-1940.

general motors did not immediately respond to a request for comment on the report.