Senators call on GM CEO to fire top lawyer - KTUL.com - Tulsa, Oklahoma - News, Weather & Sports

Senators call on GM CEO to fire top lawyer

Posted: Updated:
  • NationalMore>>

  • Arizona inmate dies 2 hours after execution began

    Arizona inmate dies 2 hours after execution began

    Wednesday, July 23 2014 7:52 PM EDT2014-07-23 23:52:18 GMT
    The U.S. Supreme Court cleared the way for Arizona to carry out its third execution in the past year Wednesday following a closely watched First Amendment fight over the secrecy surrounding lethal injection drugs.More >>
    A condemned Arizona inmate gasped and snorted for more than an hour and a half during his execution Wednesday before he died in an episode sure to add to the scrutiny surrounding the death penalty in the U.S.More >>
  • Judge strikes down gay marriage ban, stays ruling

    Judge strikes down gay marriage ban, stays ruling

    Wednesday, July 23 2014 7:52 PM EDT2014-07-23 23:52:14 GMT
    A federal judge in Denver has declared Colorado's gay marriage ban unconstitutional, but he issued a temporary stay of the ruling until an appeals court hearing next month.More >>
    A federal judge in Denver declared Colorado's gay marriage ban unconstitutional on Wednesday, but he issued a temporary stay of the ruling to give the state until next month to seek an appeal.More >>
  • Document: Man tied to gun said 'bomber' his friend

    Document: Man tied to gun said 'bomber' his friend

    Wednesday, July 23 2014 7:44 PM EDT2014-07-23 23:44:38 GMT
    A man believed to have provided the gun used by Boston Marathon bombing suspects to kill a university police officer has been arrested on drug and weapon charges.More >>
    Details emerged Wednesday on another friend of Boston Marathon bombing suspect Dzhokhar Tsarnaev who may have been linked to events surrounding the deadly attack, this one a high school classmate tied to a gun used to kill...More >>
By MARCY GORDON and DEE-ANN DURBIN
AP Business Writers

WASHINGTON (AP) - Lawmakers on Thursday demanded General Motors fire its chief lawyer and open its compensation plan to more potential victims as a Senate subcommittee delved deeper into GM's mishandling of the recall of small cars with defective ignition switches.

Sen. Claire McCaskill, D-Mo., who chairs the subcommittee, praised GM CEO Mary Barra, saying she "has stepped up, and with courage and conviction has confronted the problem head on and the corporate culture that caused it."

But McCaskill also put Barra on the spot, telling the CEO that she should have fired GM's corporate counsel, Michael Millikin, based on the conclusions of an internal report by outside attorney Anton Valukas. Millikin sat next to Barra as she defended him as a man of "tremendously high integrity."

The Valukas report found that GM's legal staff acted too slowly to share details of settlements it was making in cases involving Chevrolet Cobalts and Saturn Ions where the front air bag hadn't deployed in a crash, possibly due to a defect in the ignition switch. The lawyers didn't alert engineers or top executives to a potential safety issue.

She also questioned why Millikin didn't inform GM's board or the U.S. Securities and Exchange Commission of the potential for punitive damages as GM settled the cases, saying, "This is a either gross negligence or gross incompetence on the part of a lawyer," she said.

Barra said Millikin had a system in place but it failed. Some lawyers were among the 15 people the company let go based on Valukas' report.

Millikin said he only learned about the ignition switch problems in February and acted quickly once he did. He said any potential settlement, no matter how small, must now be brought to him before any action is taken.

But Sen. Richard Blumenthal, D-Conn., also called for Millikin to be fired, saying that an ongoing Justice Department investigation will likely find evidence of "cover-up, concealment, deceit and even fraud" within GM's legal team.

He also asked Millikin whether the company would make public all of the documents it gave to Valukas, whether it would unseal previous settlements and whether GM would waive the legal shield from its bankruptcy that protects it from lawsuits related to crashes that happened before July of 2009.

In all three cases, Millikin said no.

Millikin also acknowledged that the attorneys dismissed from GM received a retirement package based on the salary they would have made if they hadn't been terminated. Sen. Roy Blunt, R-Mo., suggested that's why the attorneys aren't challenging their dismissal.

GM has admitted that it knew about the faulty switches for more than a decade before recalling the cars. The ignition switches can fall out of the "run" position, causing the engines to stall. It took years for GM engineers to connect the switch problem to the failure of front air bags to deploy in certain crashes.

GM recalled 2.6 million small cars beginning in February. That recall prompted an unprecedented safety review within the company, which has since issued 54 separate recalls for 29 million vehicles.

Lawmakers also questioned Rodney O'Neal, the CEO of Delphi, which made the switches for GM. The switches didn't meet GM's specifications when they were first used in 2001. Later, a GM engineer changed the design but didn't change the part number, making it harder to trace the problem.

O'Neal said Delphi wasn't informed about problems until February, and said the company bears no responsibility. Barra agreed.

O'Neal also said it's common for changes to be made in parts without changing the part number. In 2013, he said, Delphi had about 120,000 engineering changes, and only about 40 percent of them had a part number change. In the case of the GM switch, however, Barra has previously called not changing the part number "unacceptable."

Compensation expert Kenneth Feinberg, who is administering a plan for victims' families, was the first to testify Thursday. The plan will begin taking claims Aug. 1.

Blumenthal asked Feinberg if the compensation plan should be expanded to cover victims of other recalls, specifically a June 30 recall of 8.2 million older large cars such as the Chevrolet Impala and Malibu with ignition key defects. In that case, the switch meets GM's regulations but the key can pull it out of the "run" position.

Feinberg said it's not up to him which vehicles to include.

___

Durbin reported from Detroit. AP Auto Writer Tom Krisher also contributed to this report.

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

  • U.S. & World NewsMore>>

  • Honduran families deported back to a bleak future

    Honduran families deported back to a bleak future

    Wednesday, July 23 2014 7:44 PM EDT2014-07-23 23:44:48 GMT
    Elsa Ramirez already had lost two brothers to violence in this remote Caribbean region when co-workers handling clandestine cocaine flights from South America murdered her husband four months ago.More >>
    Elsa Ramirez already had lost two brothers to violence in this remote Caribbean region when co-workers handling clandestine cocaine flights from South America murdered her husband four months ago.More >>
  • House, Senate advance competing border proposals

    House, Senate advance competing border proposals

    Wednesday, July 23 2014 6:43 PM EDT2014-07-23 22:43:57 GMT
    Senate Democrats and House Republicans are moving separately to slash President Barack Obama's $3.7 billion emergency spending request for the southern border, but they're unlikely to end up with a deal...More >>
    At an impasse on immigration, House Republicans and Senate Democrats advanced competing proposals Wednesday for dealing with tens of thousands of young migrants showing up at the southern border. Each side quickly ruled...More >>
  • Calls for troops at border echo previous pushes

    Calls for troops at border echo previous pushes

    Wednesday, July 23 2014 6:26 PM EDT2014-07-23 22:26:59 GMT
    Texas Gov. Rick Perry was speaking to voters in Iowa as much as Texas when he deployed as many as 1,000 armed National Guard troops to the Mexican border in South Texas.More >>
    When Texas Gov. Rick Perry announced the deployment of up to 1,000 armed National Guard troops to the Mexican border he was speaking to voters in Iowa as much as Texas.More >>
Powered by WorldNow

P.O. Box 8 Tulsa, OK 74101-0008

Powered by WorldNow

All content © Copyright 2000 - 2014 Worldnow and KTUL. All Rights Reserved.
For more information on this site, please read our Privacy Policy and Terms of Service.