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Federal Bankruptcy Law Trumps Consumer Law For Some Unhappy GM & Chrysler Owners

One unhappy reality for some owners of some claimed defective GM and Chrysler vehicles is that Federal bankruptcy law trumps all consumer law. In Georgia, for example as well in other states, some unhappy vehicle owners find that state lemon laws will not help them since Federal bankruptcy law negates the power of any consumer laws, federal, state or local.

A further problem is that since 1999, a group of consumer lawyers from the Texas law firm of Heard, Robins, Cloud and Lubel first instituted legal action against GM over a claimed product liability case in which it was alleged that some 1999-2003 GM trucks sold under the GMC, Chevrolet, Cadillac and Oldsmobile brand names were sold with defective emergency brake systems, claiming GM knew of the problem with the brakes but failed to fix the problem.

The lawsuit even claims that GM did not warn the customers, issue a recall for the claimed problem or offer to fix the claimed problem. Apparently during the Bush Administration years, the main consumer product safety organization or even the Attorney General didn't take any action to force a fix for the claimed problems either. Now a new law firm from Newport Beach, Bisnar/Chase has taken on the case as well to offer new help to the efforts of the Texas law firm first contacted by angry consumers in this class action lawsuit.

On the behalf of GM, it appears that the company views any brake problems as normal maintenance problems that are the responsibility of the consumer owner to repair at their own cost when they break or need repair. Truth be told, some products will simply wear and tear, or need periodic maintenance. Whether this GM emergency brake dispute is a case of a defective product or simply wear and tear is likely part of the dispute that has kept this issue in litigation for so many years and now involved the best talents of two of the best consumer law firms in the U.S. for years. $350 million dollars is at stake for GM as well, not a particularly small chunk of change either.

Consumer law lawyers like Bisnar/Chase are acting as consumer advocates when business or government agencies fail to act in cases where the public feels that a product is defective and might have caused them financial loss or even injury. However, GM's Federal bankruptcy court case greatly complicates any existing consumer law case. Will consumers who feel that a problem exists be able to find justice here? Federal bankruptcy law greatly complicates any claims by consumers right now leaving a few unhappy consumers.

Note: Wizbang Blue is now closed and our authors have moved on. Paul Hooson can now be found at Wizbang Pop!. Please come see him there!

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Comments (1)


I'm sure Barry 'will make it right'. After all, he's above the law. Ask the bondholders at Chrysler. Barry's all about laws with 'empathy'. Or is this one more thing that will get thrown under Barry's bus?


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Editors: Lee Ward, Larkin, Paul S Hooson, and Steve Crickmore

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