Arizona Sues General Motors For $3B Over Vehicle Recalls

The state of Arizona filed a lawsuit against General Motors (GM) on Wednesday, claiming that the automaker intentionally deceived the state’s consumers and put the public’s safety at risk by concealing safety defects in its vehicles to avoid the cost of recalls.

Arizona Attorney General Thomas C. Horne said that the state is seeking an estimated $3 billion from the automobile company, which had announced the recall of 2.6 million small cars worldwide because of a problem with the ignition switch, The New York Times reported Thursday, adding that the latest lawsuit is the first major legal action against GM over the recalls this year. The complaint also provided details of several other defects in GM vehicles, involving seatbelts, brake lights, airbags, transmission cables and headlights.

“We’re proceeding with our own suit because it’s the best way to protect the citizens of Arizona,” Horne told the Times in an interview. “General Motors represented that it was taking care of the safety of its cars, and in fact there were serious defects that it did not disclose to the public for years.”

According to the Times report, about 300,000 of the company's vehicles recalled in 2014 were registered in Arizona. The state’s consumer penalty statute stipulates $10,000 for each violation, which potentially amounts to $3 billion.

The lawsuit claimed that GM CEO Mary Barra was informed in 2011, when she was head of product development, of a safety defect associated with the electronic power steering of several models. “Despite 4,800 consumer complaints and more than 30,000 warranty repairs, G.M. waited until 2014 to disclose this defect,” the complaint said.

Meanwhile, GM has argued that it should not face lawsuits based on safety issues on its cars that were produced before its 2009 bankruptcy, Reuters reported, adding that the Detroit -based company is currently running a compensation program for cars recalled due to defective ignition switches.

The case is State of Arizona vs General Motors LLC, Case No. CV2014-014090, the Superior Court of the State of Arizona, County of Maricopa.