GM Knowingly Sold Millions of Faulty Airbags, Lawsuit Claims

General Motors Company GM has had a class-action lawsuit filed against them alleging that they intentionally concealed defects in airbags and seatbelts, and at least 1,298 people have died or been injured as a result. 

What Happened: In 1999, GM employed Delco Electronics. These engineers were commissioned to design an SDM module, or "Sensing and Diagnostic Module": the sensor in a car responsible for deciding when to deploy airbags and lock seat belts. 

Delco Electronics advised GM that the SDM should be programmed to deploy airbags at 45 milliseconds of indication that an accident occurred. However, the lawsuit claims GM deliberately ignored this advice and set their SDMs at 150 milliseconds. 

Later in 2009, GM had to file for bankruptcy and reorganized itself as a new entity. 

However, "'When it was formed in 2009, General Motors LLC acquired books, records, and personnel from Old GM that reflected this reckless decision to use the dangerous SDM calibration in its trucks and SUVs," the lawsuit claims and "despite this acquired knowledge, GM continued to use Delco SDMs in its vehicles and, on information and belief, continued to use the defective calibration associated with those Delco SDMs as well."

The lawsuit's main contention is that GM committed fraud by concealing these SDM issues and also violated various state laws. The compensation amount has not yet been stated, but it will undoubtedly be high given the severity of the accusation. 

Why It's Important: This lawsuit carries serious weight. The complaint also cites National Highway Traffic and Safety Administration data that shows these faulty airbags did not deploy in at least 1,298 crashes where people were either killed or injured. Additionally, the lawsuit is claiming to represent "millions" of GM consumers since 2009. 

If the court ends up ruling against GM, they will have to recall millions of vehicles which could cost billions, and pay substantial compensation to the affected customers. For reference, the recent GM Takata airbag recall cost them an estimated $1.2 billion. 

This litigation is not necessarily surprising since GM has had issues with hiding vehicle defects to avoid the costs of a recall in the past, for example, with the 2015 ignition switch scandal.