GM sued by investor over slow ignition fix

Fri Mar 21, 2014 9:01pm EDT

General Motors Co's new chief executive Mary Barra addresses the media during a roundtable meeting with journalists in Detroit, Michigan January 23, 2014. REUTERS/Carlos Osorio/Pool

General Motors Co's new chief executive Mary Barra addresses the media during a roundtable meeting with journalists in Detroit, Michigan January 23, 2014.

Credit: Reuters/Carlos Osorio/Pool

(Reuters) - General Motors Co (GM.N) and its Chief Executive Mary Barra are being sued by an investor for failing to adequately address known defects in its cars that led to the recall of over 3.1 million vehicles, according to court documents.

The lawsuit filed by investor George Pio seeks unspecified damages from the carmaker claiming the recalls "triggered a sharp decline in the company's share price, wiping out billions in shareholder value". It also seeks class action status.

In the last two months, GM has recalled more than 3.1 million vehicles in the United States and other markets. The actions started with last month's recall of more than 1.6 million vehicles for faulty ignition switches linked to 12 deaths.

The company had said it first learned of the defect in 2001, before the cars went into production.

The lawsuit filed in a federal court in Michigan on Friday claims that "GM's illegal and immoral activities" during the period eroded the company's reputation for safety and quality.

Barra is scheduled to testify on April 1 before a U.S. House of Representatives panel investigating the company's problem with the ignition switches.

Several lawsuits have been filed against the company on behalf of car owners affected by the recall.

The company's shares have fallen 3 percent since the first recall was announced on February 7.

General Motors was not available for comment outside normal working hours.

(Reporting by Rohit T. K. and Aman Shah in Bangalore)

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Comments (2)
Daleville wrote:
Wouldn’t it be nice if the “investor” was more concerned about people who died and who were injured than the fact that the stock price is lower?

So many investors seem to be greedy and self centered jerks.

I hope the stock drops even lower so that he will lose more money and that his lawsuit is thrown out of court.

It will serve him right!

Mar 21, 2014 10:32pm EDT  --  Report as abuse
jjm7082 wrote:
I agree with you 100% and I am invested in GM stock.

Mar 22, 2014 11:57am EDT  --  Report as abuse
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