First GM Bellwether Case Dropped for Fraud, Hundreds More to Go

General Motors Co. just watched the first big court case over an admitted deadly defect in its cars melt down as an Oklahoma postman who claimed GM ruined his life dropped his suit, accused of lying.

The case was the plaintiffs’ own pick – the first of six “bellwether” trials used in mass litigation to help each side weigh its strengths and weaknesses – and one of the biggest disasters for a high-profile personal injury action in recent memory.

“We are pleased that the case is over without any payment whatsoever” to the plaintiff, a GM spokesman, James Cain, said in a statement.

For GM, that’s one down, hundreds to go.

America’s biggest automaker may have just blown the first plaintiffs out of court, but it still faces a fusillade of claims. Plaintiffs’ lawyers will have to be extra vigilant to avoid another devastating loss in court, and the second bellwether case, this one selected by GM, is well positioned to go the automaker’s way. Yet powerful claims remain over the engineering flaw in GM’s ignition switches. The jury in each trial will hear details of a person’s life being turned upside down, and how GM covered up the flaw for years to save cash.

‘Apparent Lies’

Since the jury never got to weigh the postman’s case on the merits of the faulty ignition switch itself, the failed litigation won’t affect the remaining cases, said Clarence Ditlow, executive director of the Center for Automotive Safety.

“The purpose of these bellwether cases is to test the legal theories. The allegations that the plaintiffs lied had nothing to do with the merits,’’ Ditlow said.

Robert Scheuer, the Oklahoma mail carrier at the center of this first, busted trial, will walk away empty-handed. He had claimed the defective switch in his 2003 Saturn Ion disabled his air bag in an accident that led to neck and back injuries. The case collapsed after GM found evidence undermining several claims. They included the nature of Scheuer’s injuries and his family’s eviction from their “dream house” after the wreck, which they blamed on memory loss from the accident and a check they said Scheuer forgot to send.

“The apparent lies the plaintiff and his wife told the jury ended the trial early,” Cain said in the statement.

Victor Pribanic, a lawyer for the family of James Yingling, a 35-year-old man who died 17 days after his 2006 Saturn Ion crashed in Pennsylvania in November 2013, has the third case, set for trial in May in federal court in New York. Pribanic said it’s rare for clients to lie in court.

“I’ve been doing this for years, and I can count on one hand the number of people who would come into court and tell a fib,” he said.

What’s a Win?

Yingling, a laborer who was opening up a used car lot at the time of his death, crashed into a culvert and a bank. The lawsuit claims the ignition switch failed, cutting off power, causing Yingling to lose control of the Saturn. His air bags didn’t deploy, Pribanic said.

Friday’s Scheuer meltdown won’t have an effect on his case, Pribanic said. “You have to spend time with your clients, and you need to know them,’’ including any “rust spots,’’ Pribanic said. The Yingling trial will be focused on the accident and the death. In the Scheuer case, he said, the pursuit of an allegation that the plaintiffs lost a dream home because of the accident “opened it up’’ to the attack that destroyed it.

“Calling this a win is a stretch,’’ said plaintiffs’ attorney Derek Potts, who represents dozens of clients alleging personal injuries or deaths caused by GM ignition switch failures. “A win would be a defense verdict.’’ The case was dropped because of a “collateral issue,’’ Potts said.

U.S. District Judge Jesse Furman, who oversaw the Scheuer trial, had harsh words for the plaintiffs Thursday afternoon, when he granted GM’s request to show jurors evidence that Scheuer and his wife, Lisa, had fabricated the story blaming GM for their eviction.

“Plaintiffs have only themselves to blame for the fact that this case has become such an outlier,” Furman said after sending jurors home for the day. “Quite frankly, I would have thought counsel would do more due diligence before selecting this case for trial than obviously happened.”

“To have any trial end in such an unexpected and unfortunate way is disappointing, especially given the time and effort we put into getting ready,” Scheuer’s attorney, Robert Hilliard, said Friday. “There are legitimate concerns about the safety of this vehicle as a result of this defect. A jury needs to decide, and that’s unrelated to a dream house issue. The next jury will have that opportunity.”

‘Every Rock’

Hilliard filed claims in federal court on behalf of hundreds of people, alleging injuries and deaths connected to the defective ignition switches. General Motors last year agreed to pay $275 million to settle nearly 1,400 of these. Only a handful of his cases were left pending, including Scheuer’s.

Plaintiffs’ lawyers now have to look more closely at clients who are going to trial, particularly those who are set as bellwethers, Potts said.

“For all of us, this is a reminder of how important that process is. You have to be very careful,’’ Potts said. Defendants will “turn over every rock, look behind every tree to discredit the plaintiffs’ case, or the plaintiff,’’ he said.

That’s just what GM intends to keep doing, Cain said.

“We have assembled a legal team that is thorough, dogged and tireless in seeking the truth, and they are very skilled at resolving issues in a way that is fair and just to both sides,” Cain said.

Look Out, GM

Carl Tobias, a professor at the University of Richmond School of Law, said he assumes plaintiffs lawyers in the coming trials “are preparing their cases as fully and carefully as possible because they need to win as many of the remaining cases as possible to move the MDL [multidistrict litigation] cases to settlement.”

But unexpected damaging revelations can strike either side of a dispute, he said, including GM, which is in court over its own engineering failures.

“These lawsuits against General Motors are the result of errors that took place on GM’s part, which emerged over the course of many years and eventually became public information,” said Larry Dubin, a professor at the University of Detroit Mercy School of Law. “So it can happen to either side when there’s a lack of investigation.”

The case is Fleck v. General Motors LLC, 1:14-cv-08176, U.S. District Court, Southern District of New York (Manhattan).