$4.9 Billion Judgment Latest in GM Liability Saga

The $4.9 billion judgment against General Motors this month in a fuel-tank fire case is the latest chapter in a long saga involving independent counsel and former GM lawyer Kenneth Starr, accusations of perjury and obstruction of justice, and an infamous 1973 internal memo revealing that General Motors engineer Edward Ivey had placed the value of a human life at $200,000.

The record-settling judgment in the latest case centered on a California crash in which six people in a GM pickup truck were hit from behind by a drunk driver. The truck’s fuel tank exploded, seriously burning the occupants.

This is not the first time that memo has made headlines. Back in 1994, the now-familiar Kenneth Starr was representing GM in a suit brought by a South Carolina family whose two sons had been killed in a similar GM truck explosion. Starr has been accused of covering up perjury by Ivey. In April 1998, the Justice Department decided not to open an ethics probe into Starr’s role in the alleged coverup.

It is also important to note that, amid widespread agreement in the legal community that the California decision will be reduced by another court, General Motors is enjoying one of its biggest periods of growth and profit in history. On July 20, 1999, the company announced that it had record earnings in the second quarter of 1999, with a profit of $1.7 billion. At that rate, one could extrapolate that the company can afford to lose one major case a year related to fuel-tank fires and still make a few million in profit.

Read the original MoJo Wire story that uncovered the allegations against Starr, along with key documents and updates.