Arent Fox Partner Aaron Jacoby Discusses Closely Watched Auto Industry Stories with Law360 and LA Times

Automotive partner Aaron H. Jacoby talked with Law360 about five auto litigation trends to be aware of, including the recent high-stakes suits on topics such as whether auto manufacturers can bypass dealerships based on Tesla’s direct sales model as well as whether auto manufacturers will be forced to disclose their mineral suppliers or should fear breach of warranty class actions.

They also discussed the recall by General Motors (GM) of more than 2.5 million vehicles over an ignition switch malfunction which dominated recent headlines. GM asked a bankruptcy judge to bar plaintiffs from bringing ignition switch claims tied to cars that were created before the company’s 2009 bankruptcy.

“The problem is that the new GM manufactures the same products, employs the same people and outwardly appears to be the same company even though it is not — and consumers want to know what the new GM will do with claims connected to the old GM, Aaron explained. He added “[t]his is a case to watch because Toyota just paid $1.2 billion to settle an investigation with regard to recall claims it was facing, so if you assume GM’s liability will be just as much, there’s billions of dollars involved. The outcome could affect GM’s stock price, what their dealer body thinks or does with the brand, and it affects how consumers will think about the brand.”

Mr. Jacoby also talked with the Los Angeles Times about the GM recall and noted that recalls do not make dealers happy, despite any revenue they might generate: “Dealers are concerned for the reputation of the GM brand in the long term in the event that this short-term crisis is not handled properly.”

To read the Los Angeles Times article, click here.

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