Successor Liability, Company Law, and Bankruptcy: The Context of Liability for
Abstract
After suffering through five years of losses and a precipitous decline in market share, General Motors found itself in a precarious position—with $172.8 billion in liabilities and $82.3 billion in assets. At approximately the same time, the United States was experiencing its greatest financial crisis since the Great Depression. General Motors received $13.4 billion from the Obama and Bush Administrations as part of their plans to ―save the American automobile industry.‖ The confluence of these events led General Motors to file for Chapter 11 bankruptcy in June of 2009 in order to restructure its debt and reconfigure its corporate structure while continuing to operate as the ―New GM‖ during the reorganization. In this process, the ―New GM‖ decided it would not assume responsibility for injuries that drivers and others had suffered attributable to various vehicle defects in automobiles and trucks General Motors had manufactured. This article takes a close look at the issues presented relating to the General Motors bankruptcy in light of principles relating to successor liability and American company law.