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GM files claim for billions in Delphi case

General Motors Corp. filed a multibillion-dollar claim against auto parts supplier Delphi Corp., which has filed for bankruptcy protection.
/ Source: The Associated Press

General Motors Corp. filed a multibillion-dollar claim against auto parts supplier Delphi Corp., which has filed for bankruptcy protection.

Troy, Mich.-based Delphi said in a document filed Monday that the automaker submitted the claim July 31, the deadline for filing unsecured claims against the auto parts supplier. Delphi used to be a subsidiary of GM and is still its biggest supplier. Delphi’s ability to continue operations affects GM’s viability, the automaker has said in the past.

Delphi has said it also has claims against the automaker.

GM’s claim comes at a time when the committee that represents creditors has asked a bankruptcy judge for permission to take a bigger role in negotiations between Delphi and GM, to protect the interests of creditors other than GM.

Delphi was spun off from GM in 1999. The creditors committee has alleged that GM used the spinoff to rid itself of labor and retirement costs. According to court papers, the committee seeks the right to sue GM and former Delphi executives who helped transfer those obligations to Delphi from GM.

GM has given financial aid to Delphi in the attrition programs it has reached with its two biggest unions but retained the right to get back those contributions once Delphi emerges from court protection.

The request by the creditors committee will be considered at a hearing on Aug. 17.

At the same time, the debtor seeks the right to abandon supply contracts it has with GM. A hearing on that motion may proceed as early as Aug. 15.

On Friday, the company returns to court to continue with its motion to abandon its labor contracts and retirement benefit obligations.

Delphi entered bankruptcy protection on Oct. 8, 2005. It is the largest American auto-parts supplier to do so.