Court: GM’s “crime” subjects privileged documents to unusual review
In an extremely unusual move, a judge has ordered a review of sensitive attorney-client communications in the General Motors airbag defect case for possible release. In an order filed Thursday, Judge Elizabeth Byrne Hogan said that GM’s admitted criminal conduct may exempt the documents from the privilege that normally allows them to be kept confidential.
[quote] Prima facie evidence of a crime or fraud exists–Elizabeth Byrne Hogan, Missouri Circuit Court Judge [/quote]
Last year, GM signed a deferred prosecution agreement admitting to criminal conduct in covering up deadly safety defects. The company agreed to pay $900 million. As part of the deal, according to Judge Hogan, GM “admitted that it failed to disclose to its U.S. regulator and the public a potentially lethal safety defect that caused airbag non-deployment in certain GM model cars and that GM further affirmatively misled consumers about the safety of GM cars afflicted by the defect.” GM also acknowledged engaging in a scheme to conceal another deadly defect: a faulty ignition switch.
James Cain, a senior manager at GM, provided this statement: “As Judge Furman of the federal [multi-district litigation] has held on at least two occasions, there is no basis to conclude that the company conspired with its lawyers to commit a crime-fraud. The order of the St. Louis court directly contradicts Judge Furman’s ruling on the exact same allegations, and we will vigorously pursue all appellate remedies available to us.”
Under the order, attorney-client communications between GM and its counsel, King and Spalding, will be reviewed by a Special Master for possible release to victims in the case of Felix, et al. vs. General Motors. That lawsuit was filed in 2014 on behalf of more than 15 Missouri residents harmed and killed in GM vehicles with faulty ignition switches. The vehicles involved were later subject to an ignition switch recall, according to court documents.
The faulty airbag problem extends far beyond GM. More than 28 million Takata airbag inflators have been being recalled in the U.S. Millions of consumers have received recall notices but are being told there’s no fix yet available, and that they should keep driving the suspect vehicles.