July 14, 2014
When GM filed bankruptcy in 2009, the company was required to file disclosures to the court about its potential liabilities and known creditors. It did not include any of the people with active legal claims against the company based on ignition switch problems in its list, according to the court filing.
Federal prosecutors are developing a criminal fraud case hinged on whether General Motors made misleading statements about a deadly ignition switch flaw, and are examining activity dating back a decade, before GM’s 2009 bankruptcy, according to multiple sources familiar with the investigation.
Prosecutors are not limiting their inquiries to events that occurred after GM emerged from bankruptcy in 2009, sources said.
Legal experts said bankruptcy does not release GM from criminal liability in a fraud case.
GM has previously said it is protected from liability for claims related to incidents that occurred before it exited bankruptcy in 2009. But it has now taken its first steps to raise those issues with the court by filing motions to stay recall-related lawsuits while it asks that bankruptcy court to clarify the extent of that protection.