According to the Complaint, GM is one of the nation’s oldest and largest car manufacturers. With a dealership network that spans the globe and over 200,000 employees, the Company plays a major role in the United States and international automobile market.
The Complaint alleges that Defendants engaged in a scheme to hide from consumers and investors that GM’s cars were plagued with a number of dangerous defects, which resulted in a multitude of adverse events including fatal
car crashes and devastating injuries to GM’s automobiles, drivers, passengers and others.
On February 7, 2014, the Company notified the NHTSA of its decision to recall 2005-2007 Chevrolet Cobalt and 2007 Pontiac G5 vehicles, due to defects in the manufacturing of their key ignition switches. On this news, the Company’s shares fell $1.21 per share or over 3% to close at $34.90 per share on February 10, 2014.
Then, on February 24, 2014, the Company expanded the recall to include the 2003-2007 Saturn Ion, 2006-2007 Chevrolet HHR and Pontiac Solstice, and 2007 Saturn Sky. These initial recall announcements included more
than 1.65 million vehicles. On March 11, 2014, the Company sent a letter to the NHTSA detailing the alleged issues with GM’s ignition switches and submitted a chronology of the Company’s discovery of such problems and failure to properly advise consumers and regulators, leading to various injuries and deaths. On this news, the Company’s shares fell $1.91, to close on March 11, 2014 at $35.18 per share, a one day decline of over 5%, on volume of over 41 million shares.
The Company’s stock price continued to decline in the subsequent trading sessions after reports of a criminal investigation into GM’s business practices was reported on March 11, 2013, after trading hours. The Company’s
stock price fell a further $1.09, or 3% per share, to close on March 13, 2014 at $34.09.
On March 17, 2014, the Company issued a press release announcing that “GM redoubles safety efforts,” and reported further recalls of vehicles including over 1.5 million additional cars not previously recalled. Thus, in a span
of less than seven weeks, the Company announced recalls more than 3.1 million vehicles. The Company also announced a $300 million charge in the first quarter of 2014 in order to deal with the recall campaigns.
On October 24, 2014, the Court issued an Order appointing lead plaintiff and approving lead counsel.
The parties agreed to a Stipulation of Settlement on November 11, 2015. This Settlement was approved by the Court on November 20. On May 23, 2016, the Court granted final approval of the Settlement and entered Final Judgment. On June 13, an Objector filed a notice appealing the Settlement. The Court of Appeals affirmed the District Court's Judgment on November 27, 2017. The Court issued an Order approving the Settlement's distribution plan on May 21, 2019.