Orange County is suing Detroit automaker General Motors, alleging that the company concealed dozens of dangerous defects that caused 2,004 deaths and injuries while it promoted sales over safety.
The suit by District Attorney Tony Rackauckas was announced Monday, the same day that GM rolled out six new recalls of older model, full-sized sedans with faulty ignitions.
Since January, GM has been forced to recall more than 25 million vehicles sold in the United States with 35 separate defects covering ignitions, power steering, airbags, brake lamps and other crucial systems.
"This case is about having safe cars on the road because cars carry our most precious cargo. Orange County citizens rely on safe cars to transport and meet their families and friends, and get to work," Rackauckas said in a prepared statement. "Each driver ... should be able to expect that the other cars on the road are safe and will not cause a harmful, preventable accident."
General Motors declined comment.
The suit, filed Friday, accuses General Motors of deceptive business practices and unfair competition, alleging that the automaker marketed its brands as safe and reliable while burying defects.
Karl Brauer, a senior analyst with Kelley Blue Book, said GM has promised not to cap its victims' compensation fund, which is very responsive and indicates that local prosecutors don't need to get involved.
"There's no doubt (the backlash against GM) was overdue and there was carelessness on the part of GM," Brauer said. "My position is they are doing everything a company like GM should do."
The National Highway Safety Administration has already fined General Motors $35 million, and the justice department is weighing another potential penalty, Brauer said.
The lawsuit said the company deliberately concealed defects by endlessly investigating and delaying action each time a new one was found. Personnel were trained to never use the words "defect," "stall" or other terms suggesting that any GM-branded vehicle was defective, according to the lawsuit. Employees also were trained to routinely choose the cheapest part supplier without regard to safety and were discouraged from addressing safety problems, the suit said.
Owners have seen their vehicles devalued because of the recalls, said the suit.
The most high-profile of the GM defects have been the ignition switches in more than 1.5 million vehicles sold by the company before the 2009 bankruptcy. The switch can cause the ignition to move from the "run" position to the "accessory" or "off" position, disabling the power steering and the air bags as well as brake lights.
According to the lawsuit, the company continued to use defective ignition switches in vehicle repairs sold after July 10, 2009.
The suit alleges GM knew at least since it emerged from bankruptcy that the ignition switches were a problem. It wasn't until February 2014 that the company began to remedy the problem, says the suit.
Another problem was the power steering.
Between 2003 and 2010, more than 1.3 million GM-branded vehicles in the United States were sold with a safety defect that causes the vehicle's electric power steering to suddenly fail and revert back to manual steering, requiring greater effort by the driver to steer the vehicle and increasing the risk of collisions and injuries, according to the lawsuit.
"The numbers of recalls and serious safety defects are unprecedented and can only lead to one conclusion: GM and its predecessor sold a large number of unsafe vehicle models with myriad defects during a long period of time," the suit said.
The Orange County lawsuit says the evidence shows a consistent pattern: GM learned about a particular defect and, often at the prodding of regulatory authorities, "investigated" the defect. GM then took minimal action -- such as issuing a carefully-worded "Technical Service Bulletin" to its dealers -- or even recalling a very small number of affected vehicles, said the complaint.
"All the while, the true nature and scope of the defects were kept under wraps, vehicles affected by the defects remained on the road and GM enticed consumers to purchase its vehicles by touting the safety, quality and reliability of its vehicles, presenting itself as a manufacturer that stands behind its products," the suit said.
General Motors supervisors warned employees to "never put anything above the company" and "never put the company at risk," the suit said.
This isn't the first time that Rackauckas has taken on the auto industry. In 2013, Toyota Motor Corp. agreed to pay $16 million to settle a lawsuit by Orange County claiming auto defects and deception.
Original headline: Orange County D.A. sues GM, says defects were hidden
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