GM unveils compensation plan for recalled car victims

June 30, 2014, 2:41 PM UTC
Kenneth Feinberg Announces GM Ignition Compensation Program
Kenneth "Ken" Feinberg, managing partner and founder of Feinberg Rozen LLP, speaks during a news conference at the National Press Club in Washington, D.C., U.S., on Monday, June 30, 2014. Feinberg, hired by General Motors Co. (GM) Chief Executive Officer Mary Barra to administer the company's compensation fund, said GM will spend whatever it takes to compensate victims of accidents in Cobalts, Ions and other cars with faulty ignition switches. Photographer: Andrew Harrer/Bloomberg via Getty Images
Photograph by Andrew Harrer — Bloomberg/Getty Images

The aftershocks of the General Motors (GM) ignition switch scandal continued Monday, as payout expert Ken Feinberg announced just how much the families of the 13 victims of the defect and others injured will receive as a payment from GM.

Speaking at a GM press conference at the National Press Club in Washington, D.C., Monday, Feinberg said that for each death the victim’s family is entitled to $1 million for the person who died plus $300,000 for a surviving spouse and each surviving dependent.

The driver, any passengers in the automobile, any pedestrian, and any occupants of other vehicles involved in accidents will be eligible for compensation. If the airbag did deploy, Feinberg said it would not be considered an ignition switch problem and would not be an eligible accident. The vehicle in the accident must be one of the vehicles listed specifically as a part of the protocol.

Feinberg stressed that defective ignition switches would be the only relevant factor in determining eligibility.

“Any contributory negligence of the driver — intoxication, speeding, texting on a cell phone — irrelevant.”

The program will begin to receive claims on Aug. 1, Feinberg said. All claims must be postmarked by Dec. 31.

Feinberg praised GM for not putting a cap on the amount they were willing to pay, and for allowing anyone who had already settled “rip that up” and get additional compensation from GM.

The next major date to look forward to in the GM recall situation will be a possible ruling from the Department of Justice.

Feinberg is a veteran of thorny compensation cases such as this.

He previously worked on payments for the victims of the Sept. 11, 2001, terror attacks, the Boston Marathon bombing and the shooting at Virginia Tech. He is also administrator of the BP Gulf spill claims facility.

GM’s CEO Mary Barra released the following statement following Feinberg’s press conference:

“We are pleased that Mr. Feinberg has completed the next step with our ignition switch compensation program to help victims and their families,” she said.

“We are taking responsibility for what has happened by treating them with compassion, decency and fairness. To that end, we are looking forward to Mr. Feinberg handling claims in a fair and expeditious manner.”