GM’s Top Lawyer Says Some Staff Failed in Switch Recall

General Motors Co. (GM)’s top lawyer said some of his staff failed the company in handling an ignition-switch defect and delayed recall that spurred U.S. government investigations.

Some lawyers made mistakes, Michael Millikin, GM’s general counsel, said in written testimony to be delivered to a Senate Commerce, Science and Transportation subcommittee tomorrow. Advance copies of remarks of five witnesses, including Chief Executive Officer Mary Barra, were obtained by Bloomberg News.

“We had lawyers at GM who didn’t do their jobs; didn’t do what was expected of them,” Millikin said in his statement. “Those lawyers are no longer with the company.”

GM has recalled almost 26 million cars in the U.S. so far this year, an all-time annual record that took shape in February when the company announced an ignition-switch defect that engineers had known about for years. This week’s hearing is GM’s fourth since April 1 and will be more comprehensive, featuring Kenneth Feinberg, who is administering a victim-compensation program, and Anton Valukas, who led GM’s internal investigation.

Rodney O’Neal, CEO of Delphi Automotive Plc (DLPH), is also appearing alongside Barra and Millikin.

In her testimony, Barra reiterates that the Detroit-based company’s employees won’t forget the lessons of the recall, and they’re working hard to address the underlying issues.

15 Employees

“I have been inundated with calls and e-mails from employees telling me that they are more motivated than ever to make GM the best possible company for customers,” Barra said.

At least 13 deaths in crashes have been blamed on a flawed ignition switch, which can be inadvertently shut off when jarred, cutting power to the engine and deactivating air bags. It was later revealed that deliberations about the flaw were occurring as far back as 2005, though no formal recall actions were taken until this year.

That delay has led to investigations by the Transportation Department, both chambers of Congress and federal prosecutors.

Barra announced the ousting of 15 employees last month, without naming names, after the company released the results of an internal investigation into why it took GM more than a decade to identify problems with a defective ignition switch.

The probe, led by Valukas, blamed a lack of urgency in the engineering and legal departments yet didn’t reveal any conspiracy to cover up facts. The investigation confirmed that neither Barra nor Millikin knew about the faulty switches.

The Valukas investigation found that Millikin hadn’t been informed of the lengthy review of the Cobalt switch until the recall decision was made in 2014 and that he was also unaware of litigation involving fatal accidents.

Switch Feel

Some of the ousted executives included Lawrence Buonomo, the administrative head of in-house litigation, and Bill Kemp, a senior lawyer who was responsible for safety issues within GM’s legal department, people who asked not to be identified because the matter is private have said.

O’Neal emphasized that Delphi supplied the switch, not the key or lock cylinder. The Troy, Michigan-based parts company didn’t supply the steering column or determine where the lock-cylinder would be located, he said.

The “feel” of the switch, the amount of torque required to turn it, was “very important to GM,” O’Neal said.

“GM knowingly approved a final design that included less torque than the original target,” O’Neal said. “In our view, that approval established the final specification.”

Delphi began working on a redesigned switch in January 2006 at GM’s request to address warranty concerns, O’Neal said.

To contact the reporters on this story: Jeff Plungis in Washington at jplungis@bloomberg.net; Tim Higgins in Detroit at thiggins21@bloomberg.net

To contact the editors responsible for this story: Romaine Bostick at rbostick@bloomberg.net; Jamie Butters at jbutters@bloomberg.net

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