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GM Recall

GM Seeks to Shield Itself From Ignition Lawsuits

General Motors Co filed a motion in a U.S. bankruptcy court to enforce a bar on lawsuits related to ignition defects in cars sold before its 2009 bankruptcy as it fights a class action lawsuit that seeks to set aside the restriction.

The plaintiffs also filed a class action lawsuit on Monday, seeking an order declaring that GM cannot use the bankruptcy protection to absolve itself from liabilities.

The faulty ignition switch has been linked to at least 13 deaths and the recall of 2.6 million GM vehicles.

GM emerged from bankruptcy protection in 2009 as a different legal entity than the so-called old GM. Under those terms, the "new GM" shed liability for incidents predating its exit from bankruptcy, and any lawsuit related to pre-bankruptcy issues must be brought against what remains of old GM.

"New GM's recall covenant does not create a basis for the plaintiffs to sue new GM for economic damages relating to a vehicle or part sold by old GM," the company argued in a filing on Monday in the Bankruptcy Court for the Southern District of New York.

In its filing, GM asked the court to direct the plaintiffs to cease and desist from further prosecuting against new GM claims that are barred by the bankruptcy sale order and the injunction, and also dismiss the earlier claims.

The plaintiffs have claimed they bought or leased vehicles that had the defective ignition switch and accused GM of fraudulently concealing its knowledge of the defect, saying that as a result, it was not entitled to protection from liability.

GM and lawyers for the plaintiffs were not immediately available for comment.

-- Reuters