GM: December 1996 Letter to GM Pickup Truck Owners with Side Saddle Tanks: Settlement Denied by a Handful of Objectors
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GM: December 1996 Letter to GM Pickup Truck Owners with Side Saddle Tanks: Settlement Denied by a Handful of Objectors

An Open Letter to Settlement Class Members

I do not know when the proposed GM gas tank pickup truck settlement will be final for several reasons and no one knows when you will be able to expect to receive your transferable certificate.

First, Judge Marionneaux of Iberville Parish, Plaquemine, Louisiana advised everyone appearing at the hearing on November 6, 1996 that he would not rule until he first had heard from Judge Yohn of the federal court in Philadelphia. Judge Yohn is the federal judge coordinating all federal cases which have been consolidated for pre-trail proceedings in the U. S. District Court in Philadelphia.

Second, several objectors have hired lawyers to object to the settlement and argue that it should not be approved because it did not force a recall of the 1973-87 GM C and K trucks with saddlebag tanks.

I explained to the court that fighting for a recall is extremely difficult in this case. There is not one reported decision in all of the U.S. in which a court has ordered an automobile manufacturer to recall vehicles.

Every recall that I am aware of has been under the legal authority of the National Highway Traffic Safety Administration in Washington, D.C. In the case of saddlebag gas tanks, NHTSA has abandoned truck owners and has refused to demand a recall. That left lawyers for truck owners with only the ability to pursue economic compensation.

The economic package though is only one part of what we have proposed to the court.

As part of the settlement, GM has agreed to fund fuel tank safety research through an independent research effort in the amount of $4.1 million. In addition the lawyers representing truck owners have agreed to contribute another $1 million to unrestricted research specifically addressing the saddlebag gas tanks.

In open court and in my declaration submitted in support of the proposed settlement as fair and reasonable under the circumstances, I explained my belief and hope that a high density polyethylene tank liner, such as has been successfully used in the Corvette since 1978, would prove to provide a low cost retro-fit that would be much safer than the present tank. The $1 million research project would actively test such a fix, as GM did in some of its own crash testing in 1982 when three trucks were fitted with HDPE lined tanks and hit with a Chevrolet Citation at 50 miles per hour. In the final test, minimal gas was lost from a fully loaded tank. I believe that such a retro-fit can be designed and tested so that an after-market tank could be made available for a reasonable price.

As for the proposed settlement, no one can predict what a judge will do, but Judge Marionneaux's questions indicated he has a firm understanding on the limits of our class action and that an overwhelming number of owners have not objected or opted-out.

In fact, only .04% of all owners have objected to the proposed settlement and .17% have opted-out of the settlement, leaving 99.79% of all owners expecting certificates. That is purer than Ivory Snow, which is what I told the court, and is a significant reason why this proposed settlement can and I believe will be finally approved. People want it.

But do not hold your breath for a certificate. In fact, you may choose to complain to the lawyer leading the opposition to the settlement who is keeping you from getting a certificate that you or a member of your family could use or keeping you from a certificate that you could sell: That lawyer is Joe McCray, 433 Turk Street, San Francisco, CA 94102, 415.775.3900. Mr. McCray is a fine lawyer who has objected to the settlement, although he readily admitted in open court that he "does not have the foggiest idea about class actions" for property damage, which is the essence of the current case.

I respectfully recommended and urged Mr. McCray and the other lawyers who have joined with him that this settlement is fair, reasonable and adequate in light of all the circumstances in this case and that his efforts in fashioning relief should have been focused on bringing this case, as I did in 1992, not objecting now when a recall in this case is an absolute impossibility.

To object now that the settlement should not go forward because it does not provide for a recall ignores the reality of this case and the decisive roll NHTSA plays in auto safety recalls. No matter what efforts he undertakes and no matter how long the appeal, there will never be a recall in this case because NHTSA has specifically said it will not require such action.

In short Mr. McCray and his colleagues are focusing on the role of courts in personal injury and wrongful death cases under products liability laws. Unfortunately those laws DO NOT APPLY TO PROPERTY DAMAGE CASES. Product liability or strict liability in tort is a concept that is exclusive limited to personal injury and wrongful death claims. So, these lawyers are making the mistake of coming at a case from the wrong direction and with the wrong legal rules.

I have been involved in several recent and significant cases in which there were recalls: the buyback of 33,000 Nissan 1987-89 minivans and the Chrysler rear hatch latch lock cases involving 4,000,000 vehicles. But in both these cases, the actual recall was part and parcel of a joint settlement of all civil claims and official NHTSA action. The details of those cases can be found here.

There will be no such NHTSA action in this case, because NHTSA has publicly refused to take such action and has agreed with GM that it will not.

The bottom line is that well intended, but misinformed objectors, are demanding a recall and retro-fit which is something that is impossible to accomplish under the special facts of this case.

Had NHTSA not abandoned truck owners when it reported it would not be pursuing a recall, then these objectors would have some basis on which to base a claim.

As it now stands, I believe the settlement will be approved by the trial court and that Mr.McCray's group will take an appeal, thereby delaying the implementation of the settlement until the court of appeal rules. The appeal will be based on claims that the truck should be recalled and retro-fitted and in addition that the transferable certificate, which for many has a market value close to that of an old truck, is not a preferred economic remedy.

Because the settlement meets the terms of all previous objections, specifically addresses the concerns of appellate courts, and is supported by Public Citizen and the Center for Auto Safety, founded by Ralph Nader and currently headed by Clarence Ditlow, I expect the court of appeal will give its approval when the day is done and will find that the overall settlement is not perfect, but certainly fair, reasonable and adequate. When that will occur, I do not know.

April 6, 1998 Addition

On April 6, 1998 the appeal of Mr. McCray was heard by the Court of Appeal in Louisiana, as well as the appeal of General Motors with regard to the attorneys fees the court had ordered it to pay to the attorneys for the class.

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