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If Passed, Senate Bill Will Curb Liability Lawsuit Secret Settlements

May 23, 2014

Legislation was just introduced by two United States senators in the wake of the General Motors’ ignition switch recall that would force federal judges to consider public interest before sealing court records in product liability and personal injury lawsuits.

The legislation, known as the Sunshine in Litigation Act, if passed, will end secret settlements similar to the settlement some senators say GM entered into with some of the owners of the over 2 million cars that were equipped with defective ignition switches, The Detroit Free Press reported. The ignition switch scandal has been tied to 13 deaths and 42 crashes.

U.S. Senators Richard Blumenthal (Democrat-Connecticut) and Lindsey Graham (Republican-South Carolina) issued a statement concerning their proposed legislation that included, in part that, “concealment prevented the public, and future GM car owners, from learning about the dangers posed by these faulty ignition switches.” Senator Blumenthal also added, “This legislation would have enabled people to be aware of the threats to safety posed by the faulty ignition switches and deaths could have been prevented,” The Detroit Free Press reported.

The measure creates a legal presumption that would put an end to protective orders that protect liability settlements from being viewed by the public, unless a judge finds that the secrecy outweighs the general public’s health and safety concerns. The measure also stops a court from restricting a party to a settlement from disclosing public health or safety information to federal or state agencies. And, the measure would mandate that information discovered in one case may be shared with other, comparable cases, according to The Detroit Free Press. In 2011, a similar act passed through the Senate Judiciary Committee; however the act did not reach the Senate floor for a vote.

If the bill passes, the public’s access to automaker safety filings made with regulators would be widened, according to Automotive News. The federal reforms are meant to help to put an end to deadly crashes like those associated with the defective GM ignition switch. The bill would also allow private citizens, including trial attorneys and safety advocates, to access so-called “early warning reports” that automakers must submit to the National Highway Traffic Safety Administration (NHTSA).

“Timely information can save lives when it reveals lethal defects,” said Blumenthal. “NHTSA’s job should be to make life-saving information available, not more difficult to access. This up-to-date, accessible database will be a vital tool for drivers and consumer advocates in preventing future harm,” he added, wrote Automotive News.

Last week, GM was fined $35 million, which is the maximum allowable amount, for not disclosing the defect earlier, wrote The Detroit Free Press.

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