Kenneth Feinberg, the man in charge of the General Motors compensation fund dealing with the its widespread ignition switch woes, has issued an informal, two-letter response to the plaintiffs in more than 70 lawsuits seeking redress for lost resale value of their Cobalts: "No." The cases were recently combined into one, but Feinberg told The Detroit News that the fund will deal "only with death and physical injury claims," and that "perceived diminished value" will get no consideration.

ALG, the firm specializing in establishing residual values, determined that Cobalt owners had lost $300 compared to the segment competition and doesn't envision any long-term effects from the recall situation. Feinberg's statement comes in advance of public details on how the compensation fund will work and adheres to GM's long-held position on the matter. The company has already asked a judge to throw out such suits using the pre-bankruptcy defense, even as it stopped using that defense in cases of injury and death.

With plenty of potential gain from the GM suit, however, don't expect the plaintiffs to give up yet. When Toyota was sued for the same reason during the unintended acceleration debacle, it eventually settled the case for between $1 billion and $1.4 billion just to get it over with. Since the 85 law firms involved in the Toyota litigation took home more than $250 million of that total, we shouldn't expect the attorneys to give up on a GM payout, either.

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    • 1 Second Ago
      • 1 Year Ago
      $300? Let's see. GM will negotiate that down to say $200, if their lawyers are idiots. After the plaintiffs lawyers get 1/3 of that, that's $132 per plaintiff...which they will receive in the form of a voucher for new GM floor mats. Why do people even join these suits?
      Jso Rsa
      • 1 Year Ago
      This reminds me of GM's diesel fiasco in the 1980s. After years of recalls, owner revolts, class action lawsuits, and finally frustrated owners rushing to attempt get out from under those vehicles by trading them in (usually in futility), by 1986 the NADA guide for used car values said for any GM car that had the 350 diesel as an option, "If equipped with diesel, subtract $2500". That of course meant most owners were buried in negative equity, if they could find a dealer that would accept them as a trade-in at any price. Many dealers did not even want a GM diesel on their lot because the resale market was virtually nil.
      • 1 Year Ago
      Has anyone seen the used car market? If it rolls its worth 3000, and in most cases it makes more sense to buy new vs a used car 1-3 years old. What have these people lost?
      • 1 Year Ago
      This always seemed like cashing in on the misery of those who were actually hurt because of their cars. My main gripe with the fleet Cobalt I drove was really uncomfortable seats. Otherwise it was mediocre but acceptable. I wondered if the Pontiac 4 door version was better done.
      • 1 Year Ago
      You bought a freaking GM, did you expect it to retain value?
      • 1 Year Ago
      It's a Cobalt....they are worthless even without recalls.....
      • 1 Year Ago
      I work at a dealer. The Cobalts etc. are still worth the same as a trade in as they always have. Not worth much to start with - it is a Cobalt after all, but it hasn't changed one penny. Stupid people wanting money...go get a job.
      • 1 Year Ago
      Yep, just keep buyin them government motors cars! Them is real value! Let me tell you
      • 1 Year Ago
      Toyota should pay as they gloated in an internal memo.
        • 1 Year Ago
        Toyota did pay "between $1 billion and $1.4 billion". GM should pay as well.
      • 1 Year Ago
      Funny my car that is part of this recall has not lost any value. I agree these people need to get a job and the lawyers need to face tort reform.
      • 1 Year Ago
      Cheap car is cheap.
      • 1 Year Ago
      Cobalt and lost value go hand in hand even without the recall. Not because of it being a GM but all but almost all cars loose value through time. What's next, sue Blue Book?
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