Car Accident Victims Left Behind After Government Bailout
When the U.S. Government brokered a bankruptcy for Chrysler two years ago, it allowed the car maker to discharge any obligations it owed to car accident victims with pending cases against the automaker, or those who had already won an award or settlement.
The Wall Street Journal has tracked several stories of some of the losers in the government deal, including the family of Vicki Denton. Ms. Denton died when the airbag in her 1998 Dodge Caravan failed to deploy in a collision. After years of litigation, in 2009 a jury determined that Ms. Denton's vehicle was defective, and order Chrysler to pay her son $2.2 million in damages. Despite the jury's finding, Chrysler has not paid the judgment, and under the rules of the bailout will never have to.
The bailout and restructuring, like most bankruptcies, caused winners and losers. Those pursing product liability claims were the losers.
"The government was deciding who was going to be taken care of and who was not," said David Skeel, a University of Pennsylvania law school professor and bankruptcy expert who has testified before Congress on the auto bailouts. Even if the auto makers had legal rights to leave behind product-liability claims, "there is a deep unfairness. It would have been easy enough to set something aside for them."
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