LA District Court Grants Motion for GM to Abide By Settlement Agreement In Fuel Tank Case

Apr 27, 2001, 01:00 ET from The Barrett Law Firm

    PLAQUEMINE, La., April 27 /PRNewswire/ -- For the second time in as many
 days, General Motors (NYSE:   GM) suffered another legal setback today when a
 Louisiana district court denied its motion to prevent the sale of certificate
 through a middleman as part of a class action settlement agreement involving
 5.8 million GM full size pickups.
     "Bottom line, GM doesn't want class members to redeem their certificates
 because the more people who use them, the more it will cost GM," said Don
 Barrett of The Barrett Law Firm, lead class attorney.
     Instead, in a turnaround, the court granted class counsel's motion
 requesting that GM abide by the settlement agreement and ordered GM to comply
 with court rulings which approved the transferability of certificates and the
 creation of a secondary market.
     "GM's motion is without merit and it is not going to use this court to
 frustrate the settlement," said Judge Jack Marionneaux.  Further, the judge
 said he may "enjoin GM from propagandizing the public regarding the settlement
 agreement."
     The dispute between GM and class counsel involves the issue of
 transferability of certificates and whether or not class counsel can act on
 behalf of the class members.
     Last week, GM mailed out 5.8 million letters to class members offering
 them a $1000 certificate to go toward the purchase of a new GM vehicle.
     At the same time, class counsel mailed a groundbreaking offer from
 Houston-based Certificate Redemption Group (CRG) to pay class members $100 for
 their certificates if they are not in the market for a new car or truck.
     The unusual cash offer is endorsed by the attorneys representing the class
 members and several consumer organizations.  It was designed to create a
 secondary market for the certificates to ensure that all class members
 actually get something of value as part of the settlement.
     "This is the first attempt in an automotive class-action lawsuit of this
 size to put money in the hands of a significant number of class members," said
 James R. Dawley, chairman and CEO of CRG.  "According to press reports, GM
 forecast a redemption rate of only 1-2 percent.  That means that 98-99 percent
 of the class would get nothing -- except a worthless piece of paper if they
 didn't buy a new vehicle."
     Dawley said that with the certificate settlement, class members have a
 choice in what they do with their certificates.  He said once a certificate
 has been issued to a class member, they will now have at least three options
 to choose from: they can use the certificate to buy a new vehicle; they can
 sell the certificate to a friend; or they can transfer it to CRG.
     "General Motors is the world's largest automaker and has earned a
 reputation as being a first-class company over the last 100 years of being in
 business.
     "We hope that GM will now fully comply with the terms of the settlement
 and encourage the secondary market plan.  If GM makes the decision to allow
 this settlement to move forward now, we hope that perhaps as many as
 750,000 to perhaps 1 million class members will get cash for their
 certificates.  That means we could return anywhere from 75 million to
 100 million dollars to the class as a whole," said Dawley.
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X45322062
 
 

SOURCE The Barrett Law Firm
    PLAQUEMINE, La., April 27 /PRNewswire/ -- For the second time in as many
 days, General Motors (NYSE:   GM) suffered another legal setback today when a
 Louisiana district court denied its motion to prevent the sale of certificate
 through a middleman as part of a class action settlement agreement involving
 5.8 million GM full size pickups.
     "Bottom line, GM doesn't want class members to redeem their certificates
 because the more people who use them, the more it will cost GM," said Don
 Barrett of The Barrett Law Firm, lead class attorney.
     Instead, in a turnaround, the court granted class counsel's motion
 requesting that GM abide by the settlement agreement and ordered GM to comply
 with court rulings which approved the transferability of certificates and the
 creation of a secondary market.
     "GM's motion is without merit and it is not going to use this court to
 frustrate the settlement," said Judge Jack Marionneaux.  Further, the judge
 said he may "enjoin GM from propagandizing the public regarding the settlement
 agreement."
     The dispute between GM and class counsel involves the issue of
 transferability of certificates and whether or not class counsel can act on
 behalf of the class members.
     Last week, GM mailed out 5.8 million letters to class members offering
 them a $1000 certificate to go toward the purchase of a new GM vehicle.
     At the same time, class counsel mailed a groundbreaking offer from
 Houston-based Certificate Redemption Group (CRG) to pay class members $100 for
 their certificates if they are not in the market for a new car or truck.
     The unusual cash offer is endorsed by the attorneys representing the class
 members and several consumer organizations.  It was designed to create a
 secondary market for the certificates to ensure that all class members
 actually get something of value as part of the settlement.
     "This is the first attempt in an automotive class-action lawsuit of this
 size to put money in the hands of a significant number of class members," said
 James R. Dawley, chairman and CEO of CRG.  "According to press reports, GM
 forecast a redemption rate of only 1-2 percent.  That means that 98-99 percent
 of the class would get nothing -- except a worthless piece of paper if they
 didn't buy a new vehicle."
     Dawley said that with the certificate settlement, class members have a
 choice in what they do with their certificates.  He said once a certificate
 has been issued to a class member, they will now have at least three options
 to choose from: they can use the certificate to buy a new vehicle; they can
 sell the certificate to a friend; or they can transfer it to CRG.
     "General Motors is the world's largest automaker and has earned a
 reputation as being a first-class company over the last 100 years of being in
 business.
     "We hope that GM will now fully comply with the terms of the settlement
 and encourage the secondary market plan.  If GM makes the decision to allow
 this settlement to move forward now, we hope that perhaps as many as
 750,000 to perhaps 1 million class members will get cash for their
 certificates.  That means we could return anywhere from 75 million to
 100 million dollars to the class as a whole," said Dawley.
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X45322062
 
 SOURCE  The Barrett Law Firm