| 3:27 PM EST

GM Won’t Face Damages on Ignition Switch Cases



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General Motors Co. has been ruled not liable for punitive damages for crashes occurring after the company’s 2009 bankruptcy that involve vehicles built before that date.

The unanimous ruling was made by a three-judge panel of the U.S. Circuit Court of Appeals in New York City, Reuters reports. The decision shields GM from punitive damage claims involving crashes caused by 2.6 million defective ignition switches installed by “old” GM before 2009.

The court says the terms of GM’s Chapter 11 restructuring do not include the assumption of liability for vehicles produced by the pre-bankruptcy company. The issue was the subject of an earlier court battle three years ago.

GM eventually paid out more than $2.6 billion in penalties and settlements with victims covering 124 fatalities and 275 significant injuries. The switches could be jogged out of the “run” position by a sharp bump, thereby turning off the engine and disabling the power steering, power brakes and airbags.

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