Seeking Alpha

GM to play bankruptcy card

General Motors (GM) plans to ask a federal bankruptcy judge to protect it from legal liability for actions it took before its bankruptcy in 2009.

The automaker tipped off the strategy in a motion filed in a federal court in Texas. GM has been the target of 30 lawsuits related to the ignition switch recall issue.

The decision to play the bankruptcy card could bring sharp criticism to GM unless compensation packages to victims are viewed as adequate.

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Comments (13)
  • DrP79
    , contributor
    Comments (2302) | Send Message
    another fine by-product of the Government take over
    16 Apr 2014, 07:16 AM Reply Like
  • carl2591
    , contributor
    Comments (120) | Send Message
    that why i am taking my money to hyundai.. been a GM buyer in the past but not looking so good for the future. To play the bankrupt card is akin to playing the race card.


    Shows a sign of cowardliness..
    16 Apr 2014, 08:02 AM Reply Like
  • Copious28
    , contributor
    Comments (432) | Send Message
    Just makes smart business sense, since these are prior to the bankruptcy. They did the recall, which was fair, but we are talking lawsuits here. They doesn't stop them from paying a"gift" to the 12-13 families.
    Can you imagine what would happen if the govt didn't sell its stake?
    16 Apr 2014, 08:17 AM Reply Like
  • funfundvierzig
    , contributor
    Comments (3761) | Send Message
    An act of consummate customer hostility. The truculent bosses of General Motors won't stand behind the deathtraps they make and fraudulently market. Sure makes would-be buyers rush out and want to buy a GM car or truck. …funfun..
    16 Apr 2014, 08:35 AM Reply Like
  • Budavar
    , contributor
    Comments (1398) | Send Message
    Do anything to prevent free fall in GM stock
    as indicated clearly by Yahoo Finance's Tech chart?
    16 Apr 2014, 08:44 AM Reply Like
  • Hubert Biagi
    , contributor
    Comments (736) | Send Message
    All the majors have lousy charts right now, that's the only clear thing I see...
    16 Apr 2014, 09:42 AM Reply Like
  • Degenerate Gambler
    , contributor
    Comments (986) | Send Message
    The point of a bankruptcy is to wipe away past liabilities. People die in all brands of cars. It is a fact of life. Businesses are not charities, they are responsible to the shareholder. Forcing GM to cover liabilities before the bankruptcy is unlawful. If they are forced to, businesses will be asking; "what is the point of bankruptcy?"


    This is the problem with socialism. Where does it end? First GM is bailed out, now the public feels that GM owes them. GM should have been allowed to close. The other solvent automakers would have reaped the rewards of the byproduct of GM shutting down.
    16 Apr 2014, 09:17 AM Reply Like
  • funfundvierzig
    , contributor
    Comments (3761) | Send Message
    What is smashingly different in GM's case and routine business bankruptcies, is the substantial evidence of fraud, fraud committed by GM's unethical officials on the court, fraud on consumers, fraud on investors. The fraud-mongering of GM Management demands the veil of protection afforded by the bankruptcy court be stripped away. …funfun..
    16 Apr 2014, 09:23 AM Reply Like
  • JDoe20
    , contributor
    Comments (991) | Send Message
    Perpetrating another fraud on new investors in GM stock will not fix anything! I believe a reasonable voluntary compensation fund be set aside for those harmed is in order but not the Powerball type payments many judgments award. Why? It was NOT our company that did this.
    16 Apr 2014, 09:34 AM Reply Like
  • funfundvierzig
    , contributor
    Comments (3761) | Send Message
    It may have NOT been "our company that did this", but it certainly was the same imbedded and inept and integrity-depleted GM Management who did this to hapless, unsuspecting buyers and drivers, as well as to current GM shareholders. One part of the solution may be to claw-back their grossly outsized compensation. ...funfun..
    16 Apr 2014, 09:53 AM Reply Like
  • JDoe20
    , contributor
    Comments (991) | Send Message
    I would support this option if it is proven conclusively that they conspired to defraud the customers AND GM shareholders.
    16 Apr 2014, 10:36 AM Reply Like
  • Momintn
    , contributor
    Comments (5403) | Send Message
    If lawyers win going after a company that has been through bankruptcy, then lawyers are going to come out of the woodwork and have a field day. Many courthouses are already full. Think about how many auto accidents probably happened because of a broken auto part. GM isn't the only car manufacturer who has recalls either. Yesterday a guest on CNBC said that 12 out of the 13 deaths either involved someone who was under the influence of alcohol or wasn't wearing their seatbelt. I don't think they will get very big awards when that comes out in court.
    16 Apr 2014, 09:48 AM Reply Like
  • cobrautica
    , contributor
    Comments (4) | Send Message
    Does anyone think some individuals shoud be held criminally libel?
    17 Apr 2014, 12:06 PM Reply Like
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