2nd Circ. Won't Rethink GM Bankruptcy Shield Ruling

The Second Circuit on Wednesday turned down General Motors’ request that it rethink its decision that struck down bankruptcy court orders that shielded the post-bankruptcy iteration of the company from liability for ignition-switch defects due to a 2009 asset sale.

The panel, without giving its reasoning, declined GM’s petition for an en banc rehearing of its ruling earlier this summer, which reversed a lower court’s decision that the sale order of GM could be used to evade claims from the alleged defects. GM had argued in its petition that the U.S. Bankruptcy Code allows for the new GM entity — which had bought the bankrupt entity General Motors Corp. — to obtain the old company’s assets “free and clear” of the threat of Old GM's liabilities, which in this case could amount to billions of dollars read more »