GM Facing Huge Liabilities as Court Okays Class Action Over Faulty Transmissions

If you had a faulty transmission on a General Motors vehicles built between the 2015 and 2019 model-years you could be covered by a new lawsuit certified by a federal court. The class-action could result in payouts to hundreds of thousands of owners across the U.S., as Headlight.News reports.

A federal appeals court upheld a class action lawsuit against General Motors potential covering as many as 800,000 Cadillac, Chevrolet and GMC vehicles which, plaintiffs claim, suffered from faulty transmissions.

According to the lawsuit, vehicles equipped with either GM’s 8L45 or 8L90 8-speed automatic transmissions faced a variety of problems, including harsh shifts and shuddering, especially in higher gears. While the vehicles could lurch in lower gears.

Plaintiffs’ attorneys claimed GM violated the laws in 26 states by knowingly selling faulty transmissions and then trying to convince owners the issues they faced were “normal.” As many as 800,000 vehicles were included in the litigation, 514,000 included in the certified classes

The back story

The lawsuit has dragged on for several years but got a boost in March 2023 when U.S. District Judge David Lawson certified it as a class action in 2023. That move allowed all covered plaintiffs to join together in a single case rather than having to face individual lawsuits. That lowers the costs for those suing GM while raising the automaker’s potential liabilities.

GM appealed the decision, among other things countering that most of the owners had never experienced any problems with their vehicles and therefore lacked standing to sue.

But Circuit Judge Karen Moore said ruled against that argument and said “exactly how, and to what extent, each of the individual plaintiffs experienced a shudder or shift quality issue is irrelevant” to whether GM concealed known defects, and whether drivers would have found that information material, trade publication Automotive News reported.

Who’s covered – and why

The two 8-speed gearboxes were used in a wide variety of GM products sold from the 2015 through 2019 model-years.

These included the CT5 and CT6 sedans and Escalade SUV, the Chevrolet Camaro, Colorado and Silverado models, and the GMC Canyon, Sierra and Yukon SUVs. All told, about 800,000 were delivered in the U.S.

While not all owners experienced problems, those who did reported issues such as hesitation and lurching at low speeds, and shuddering and harsh shifting when in higher gears.

Some owners claimed GM told dealer service reps to say the problems were “normal,” while others report that the transmission issues continued even after repairs.

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What Next

The case now is returned to Judge Lawson who will proceed with the case out of his court in Detroit.

“We look forward to holding GM accountable before a Michigan jury,” Ted Leopold, a Cohen Milstein Sellers & Toll partner representing the drivers, said in a statement.

There is no clear timing on how the class action will proceed, however. And GM could seek to further appeal the Circuit Court decision.

The case poses the latest legal challenge to the automaker. Earlier this month, the Texas attorney-general brought a lawsuit against the automaker after it was revealed that the automaker collected personal information about owners – and how they drove. That data then was sold to various companies, including auto insurers who used that “Driving Score” to help set rates.

As many as 16 million motorists could be impacted by the data breach, the new lawsuit claiming the practice was initiated in 2015. Beyond the case filed in Texas, owners are looking to sue in other parts of the country and are reportedly seeking class-action status, as well. The potential payout could run into the hundreds of millions, even billions, of dollars in Texas alone, based on penalties outlined by state law.