Beasley, Allen, Crow, Methvin, Portis & Miles, P.C.

Chrysler Group LLC, formed when Chrysler LLC reorganized under Chapter 11 bankruptcy protection last spring, changed its stance on lawsuits filed by or on behalf of drivers and passengers who were injured in pre-bankruptcy Chrysler model vehicles. The new Chrysler says it will now assume accountability for the older cars and trucks. The old Chrysler faced 160 lawsuits filed by people injured in defective Chrysler vehicles – lawsuits that the company originally intended to leave behind in bankruptcy court.

Chrysler spokesman Michael Palese said that the newly formed company, of which Fiat owns a 20 percent stake, is more confident of itself than it was just a few months ago. “The leadership of the company feels a lot more comfortable that the company’s long-term viability will be strong,” he told National Public Radio. “…And we can accept these claims and absorb them over time without burdening the company and perhaps throwing it back into bankruptcy,” he said.

In a May 31 ruling, U.S. Bankruptcy Court Judge Arthur Gonzalez overruled objections lodged by the Ad Hoc Committee of Consumer-Victims of Chrysler LLC and other consumer groups when he approved the sale of Chrysler to Italy’s Fiat free and clear of outstanding legal claims against the U.S. car manufacturer. Gonzalez effectively ruled that only liabilities that promote Fiat’s commercial interests would be transferred.

Some analysts believe that Chrysler is following General Motors’ lead in exposing itself to pre-bankruptcy liability claims. Faced with mounting pressure from consumer advocacy groups and several state attorneys general, the auto giant chose not to absolve itself of personal injury lawsuits in bankruptcy court.

Many claimants angrily protested Chrysler’s dismissal from the lawsuits during its reorganization, saying that billions of dollars in federal bailout money were being used to strip consumers of their right to a trial.

This entry was posted on Monday, August 31st, 2009 at 3:45 pm and is filed under News, automobile accident, product liability, safety. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.