Wednesday, June 03, 2009
Chrysler, and perhaps GM product safety accident plaintiffs may lose out (ABC tonight)
ABC “World News Tonight” is reporting that victims of accidents related to Chrysler product defects will probably not be able to recover damages or sue, as Chrysler comes out of bankruptcy. The show presented a few victims with horrific injuries, and one family is faced with a $500000 a year caregiving bill that it cannot claim. At most, accident victims might claim less than 1% of their costs. The problem seems to have to do with the way bankruptcy courts handle accident liability claims among the creditors. There is a Drudge Retort on the matter here. The ABC link was not yet available as of 7 PM.
Obama said that the “sacrifices” of the bankruptcies will benefit the next generation of workers.
Update: June 7
Indiana Pension Funds have filed a stay with the US Supreme Court to block the sale to Fiat until these product liability issues are resolved. Mark H. Anderson has a story on Wall Street Journal newswires, here. The issue of junior creditors and senior lenders was raised.