General Motors has avoided paying $1 billion in stock as part of a $15 million settlement between its bankruptcy trust and plaintiffs.
Just a few days ago, it emerged that the General Unsecured Creditors Trust wanted GM to contribute $1 billion to help resolve hundreds of personal-injury cases triggered by the automaker’s faulty ignition switches.
The ‘Old GM’ trust claims that if total approved claims for the case exceeded $35 billion, GM would have to cough up $1 billion in stock to contribute. However, Bloomberg reports that the car manufacturer thwarted the settlement in court on Wednesday.
The General Unsecured Creditors Trust says that it has now reached an agreement with GM for the carmaker to cover legal expenses for fighting the claims.
Understandably, the plaintiffs in the case aren’t too happy about the trust’s agreement with GM. According to plaintiffs’ attorney Edward Weisfelner, GM “"undertook a secret, contrived scheme to undermine the settlement agreement through a campaign of threats, intimidation and payoffs.”
GM says it will continue to fight what it dubs bogus injury claims in court rather than settling.
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