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Mich. Judge Sends GM Transmission Dispute To Arbitration


March 23, 2023

A Michigan federal judge has sent a proposed class’s claims that they purchased General Motor vehicles with a defective transmission to arbitration, agreeing with the auto giant that the buyers signed paperwork that included an arbitration clause.

U.S. District Judge David M. Lawson said Tuesday that the plaintiffs in the proposed class action signed agreements, and those agreements have enforceable arbitration clauses.

“The arbitration clause is enforceable, and the plaintiffs’ objections to its application do not alter that conclusion,” Judge Lawson wrote.

The 2021 case is similar to another class action, Speerly v. GM, that Judge Lawson certified on Monday. That suit, which came from several class actions consolidated in 2019, alleges GM vehicles had eight-speed automatic transmissions that slipped, kicked back and caused the vehicles to jerk. Some drivers said they were nervous about driving the vehicles because they had “alarming difficulties” stopping when a “hard shift” would cause the vehicles to surge forward, causing some to almost hit other vehicles or pedestrians.

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Doug McNamara of Cohen Milstein Sellers & Toll PLLC, representing the plaintiffs, said he thinks GM’s argument will fail at arbitration.

“We believe the underlying legal argument attempted by GM — to invoke a dealer agreement arbitration clause to cover a manufacturer who sold defectively designed vehicles — will fail before the arbitrator or when back in front of Judge Lawson. The underlying factual issues regarding the defective 8L transmissions will be sorted out by the jury hearing the Speerly class action,” McNamara said.

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Harper and Ulrich are represented by Theodore Leopold, Douglas J. McNamara and Karina G. Puttieva of Cohen Milstein Sellers & Toll PLLC, Russell D. Paul and Amy J. Park of Berger Montague and Emily E. Hughes and Sharon S. Almonrode of The Miller Law Firm PC.

Read the article on Law360. (Subscription required.)