What If Chrysler Owners Experience A Product Defect?

How the Bankruptcy Affects Current Chrysler Owners

This means any Chrysler, Dodge or Jeep currently out on the road will never be recalled for any defect, and if there is a problem with one of the vehicles, Fiat is not going to pay out any personal injury settlements.

The terms of bankruptcy state that the ‘new’ Chrysler – the company that has emerged since the ‘old’ Chrysler declared bankruptcy – will not be held accountable for pending settlement requests. Business Week reported that even those claimants who have already ‘won’ settlements are out of luck.

The new Chrysler ownership will assume absolutely none of the responsibilities of any current lawsuits, and will also be protected against any new lawsuits coming in. There are currently more than 30 million reported Chrysler vehicles on the road that will not be eligible for any type of lawsuit if something goes wrong.

Is There Really No Hope For Chrysler Owners?

In many bankruptcy cases involving large companies – like contraceptive company A.H. Robins and breast implant manufacturer Dow Corning – there are outside insurance companies who can help pick up some of the slack in preexisting lawsuits against the bankrupt company.

Chrysler, a private company, didn’t have that. They were internally insuring each lawsuit up to $25 million. In other words, when Chrysler lost all its money, the insurance money backing any legal claims went with it.

Though it’s not definitive that claimants won’t be able to collect any settlement money from Chrysler or insurance companies, things are looking grim for current owners of defective Chrysler products, whether their lawsuits are past or in the future.

Morgan Brickley
mbrickley@totalattorneys.com
http://www.totalinjury.com/blog