Lawyers ply the Internet to score clients for GM lawsuitsReprints
(Reuters) — General Motors Co. may face lawsuits for millions of dollars over its recall of 1.6 million cars, but first lawyers have to find clients if they hope to get a foot in the courthouse door.
To do so they are buying Google search terms, registering Internet domain names, announcing investigations into GM's behavior, and turning to their Twitter and Facebook accounts to provide updates on the recall.
"This is a race to the courthouse," said Bryan Quigley, a senior vice president at the Institute for Legal Reform, an arm of the pro-business U.S. Chamber of Commerce.
Already at least two lawsuits have been filed, claiming the company concealed its knowledge of ignition problems from the public.
Law firms that represent plaintiffs, unlike corporate lawyers and litigators, typically receive a percentage of the money their clients recover. The firms that attract the greatest number with successful claims gain the most.
Take a recent class action against Toyota Motor Corp. Millions of plaintiffs said they suffered economic losses after the company recalled millions of vehicles for sudden acceleration problems. The lawyers took home $200 million in fees and $27 million in expenses in a settlement valued at $1.6 billion that was approved by a federal judge last year.
And Toyota will pay a record $1.2 billion to resolve a criminal investigation into its handling of consumer complaints over safety issues, the U.S. Justice Department said Wednesday.
GM recalled 1.6 million cars last month because a faulty ignition switch was able to turn off a car's engine, disable its airbags and make steering difficult. The problem has been linked to 12 deaths, the company says.
The recall has led to government criminal and civil investigations, an internal probe by GM and preparations for hearings by Congress. All ask why GM took so long to address a problem it has said first came to its attention in 2001.
GM has apologized for how it handled the recall and said that taking care of customers was its top priority. The company said it is authorizing dealers to provide loaner cars and a $500 cash allowance to affected customers, and is working quickly to communicate with customers on a variety of channels about the recall.
On Friday, two Texas law firms filed what appeared to be the first U.S. class action related to the GM ignition-switch recall on behalf of car owners who said their vehicles lost value because of the ignition problems. A Chicago law firm brought a similar class action on Monday, and more economic-loss and personal-injury lawsuits are expected.
Many other lawyers are going after the anticipated work.
In New York, law firm Weitz & Luxenberg P.C. has registered the domain "GMclaimslawyer.com." The site offers owners of recalled cars a free legal evaluation about what potential legal claims they might have for the "danger" GM exposed them to "when they let these fault(y) vehicles continue to go down the road."
The website, which was registered March 14, asks owners of the cars in question to contact the firm: "You'll want to be included when the decision is made, so you can get any share coming to you."
Attorney Robin Greenwald said their office had received hundreds of inquiries about the GM recall. Weitz & Luxenberg is well-known for bringing asbestos lawsuits, but auto accident cases are fairly new terrain, she said.
"The kinds of cases we bring focus on corporations and corporate malfeasance," Ms. Greenwald said. "It's all the same story, it's just different products." She declined to comment on the specifics of the website.
Weitz & Luxenberg also has bought sponsored ad space on Google, another strategy the plaintiffs' bar uses to attract business.
A search for the term "GM recall lawsuits" Tuesday afternoon showed that plaintiffs' firms had the three top ad spots on Google. A search of "GM" and "sue" turned up an ad for Kline & Specter P.C., a Philadelphia-based personal injury firm.
Shanin Specter, who co-chairs the firm, said bidders can buy Google keywords like "GM" and "recall." The going price on Tuesday for such terms was more than $8 a click, he said.
A 2012 study conducted by the Institute for Legal Reform estimated that plaintiffs' firms spent more than $53 million that year on Google keywords to reach consumers searching terms like "mesothelioma," a type of cancer linked to asbestos.
"It's not really a surprise that the plaintiffs' bar sophistication in marketing is what it is," said Mr. Quigley, a vice president at the institute.
Other plaintiffs' firms, including Hagens Berman Sobol Shapiro L.L.P. and Beasley, Allen, Crow, Methvin, Portis & Miles, P.C., are simply issuing press releases or announcing on their websites that they are launching investigations into the recall.
Attorneys at both firms, which represented plaintiffs in cases against Toyota over its acceleration recall, said they were fielding calls from potential clients.
Robert Hilliard of Hilliard Munoz Gonzales L.L.P., one of the firms that filed the first U.S. class action against GM after the recall, has made a second approach. On Monday he sent an email to lawyers hired by GM to investigate the recall asking the carmaker to change its standard recall notice to a "PARK IT IMMEDIATELY" alert, which he called "the only acceptable course and decision a moral company can make at this point."
"I write this email this morning not as an attorney and send it to you both not in your capacity as attorneys," said Mr. Hilliard. "I write you human being to human being."
A GM spokesman declined to comment on the appeal.
Mr. Hilliard, who issued a press release on his email, said in an interview on Tuesday that it was not a marketing ploy but was meant to draw attention to a public safety issue.
He has said he plans to bring personal injury lawsuits against GM.