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Judge OKs $19.5 Million Settlement in GM Transmission Case

February 12, 1987

CHICAGO (AP) _ Nearly 5 million consumers are eligible for reimbursement from a $19.5 million out-of-court settlement with General Motors Corp. for automatic transmission repairs made on 1976-1980 GM vehicles.

″It’s been a long time coming,″ Arlie G. Skelton Jr. said Wednesday after a federal judge approved the settlement. Nearly eight years ago, Skelton sued GM, claiming the transmission in his Oldsmobile Delta 88 was too small for the car.

Skelton now stands to be reimbursed for a $458 repair bill.

Under the 40-page agreement approved Wednesday by U.S. District Judge John A. Nordberg, original owners of certain GM vehicles are to be notified by the automaker and reimbursed for as much as 90 percent of the cost of repairing the transmissions.

″It’s possibly the largest consumer class-action settlement of its kind and we’re hopeful that the people who have been out there who suffered problems with their cars will get some compensation,″ said attorney Abraham Goldman, who represented plaintiffs in the class-action lawsuit.

Goldman said attorneys in the case thought only 50,000 to 150,000 claims would have to be settled. He said some people couldn’t be reached, some reimbursements were solved earlier through other means and the settlement doesn’t cover repairs which had to be made after 50,000 miles.

The settlement includes a $14.4 million repair fund, a $2.5 million reserve to cover any additional repair costs and $2.6 million in legal fees, Goldman said.

At issue were about 4.7 million Chevrolets, Pontiacs, Oldsmobiles, Buicks and Cadillac Sevilles equipped with GM’s Turbohydramatic-200 automatic transmissions.

The lawsuit, filed in March 1979, challenged GM’s use of the THM-200 transmission in cars that usually carried the larger, more durable and more costly THM-350.

The settlement was reached by attorneys for GM and the plaintiffs in July.

Nordberg indicated at a hearing in October that he would approve it, Goldman said, but final approval was delayed while the judge determined attorneys’ fees.

David Hudgens, a GM spokesman in Detroit, said the company had no formal statement on the settlement. He also said there was no admission of GM liability in the earlier tentative settlement.

The cash settlements will be based on actual out-of-pocket repair costs.

Under the settlement, minimum reimbursement for transmission repairs needed before 50,000 miles is 50 percent of the cost.

Owners of vehicles that needed repair before 24,000 miles are eligible for 90 percent of the repair costs.

Original owners whose vehicles were repaired after 50,000 miles, and used- car owners who paid for such repairs, can apply for reimbursement to offices of the Better Business Bureau, which has worked with GM to set up a mediation and arbitration system, said another attorney for the plaintiffs, Charles A. Boyle.

Original owners who have previously received compensation, from sources such as the GM consumer arbitration program administered by the Better Business Bureau, can receive up to $75 under the settlement.

Claim forms will be sent to affected consumers within two months, Goldman said, and eligible consumers should begin receiving checks in six to nine months.

Original owners who think they deserve compensation but may not be notified can contact the Settlement Administrator of the GM 200 THM Transmission Litigation, P.O. Box 65, Excelsior, Minn., 55331, Boyle said. The vehicle identification number must be included.

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