California DA hits GM with lawsuit over recalled vehicles

June 30 Mon Jun 30, 2014 4:23pm EDT

June 30 (Reuters) - A district attorney in California on Monday announced a lawsuit accusing General Motors of threatening public safety by concealing at least 35 safety defects that have prompted the recall of more than 17 million vehicles this year.

The lawsuit, filed on Friday by Orange County District Attorney Tony Rackauckas, accuses GM of violating consumer protection and unfair competition laws by delaying action to address faulty parts ranging from ignition switches and airbags to power steering.

GM's apparent cover-up put customers at risk and unfairly disadvantaged competing automakers by misleading the public about the safety of its vehicles, according to the lawsuit. It said that GM knew about the problems but delayed issuing recalls in order to keep costs down.

"We must encourage all businesses to be fair and live up to safety standards, and must not allow those engaging in unfair practices to punish those businesses that don't cut corners by compromising safety," Rackauckas said in a statement announcing the lawsuit. It seeks an order stopping GM from engaging in unfair business practices, restitution for California consumers and civil penalties.

A spokesman for GM could not immediately be reached for comment.

The case comes as GM is seeking to recover from a recall of 2.6 million vehicles over a defective ignition switch that began in February. A lawyer for GM, Kenneth Feinberg, on Monday announced a program to compensate claims for serious injuries and deaths linked to the switch.

The company is still under investigation by the U.S. Department of Justice, Congress and a group of state attorneys general in connection with the switch defect. Numerous lawsuits have also been filed against GM by customers claiming economic losses and property damage related to recalled cars.

The Orange County lawsuit covers 17 million vehicles that have prompted 40 recalls since February. It was filed before GM announced its latest round of recalls, which cover more than 8 million vehicles.

The case is People v. General Motors, Superior Court of California, Orange County, No. 2014-731038. (Reporting by Jessica Dye in New York; Editing by Ted Botha and Dan Grebler)

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