Texas Accuses GM of Running Deceptive Ads : Marketing: The state says it may sue. The auto company admits a mistake but denies trying to trick would-be customers.

General Motors Corp. faces the threat of a deceptive advertising suit in Texas related to an award given its Cadillac division.

Atty. Gen. Dan Morales is upset with an ad campaign that touted Cadillac’s winning the Commerce Department’s Baldrige Quality Award in December.

In a letter to the company last month, Assistant Atty. Gen. Stephen Gardner said six unsubstantiated representations in the Baldrige advertising campaign violate the Texas Deceptive Trade Practices Act.

The company admitted a mistake in the ads, which it corrected--but denied that it engaged in deception.

“They should be proud of receiving the award,” Gardner said. “They should be ashamed of the way they promoted the award.”

State attorneys and GM representatives are to meet today to discuss a possible settlement.

The Malcolm Baldrige National Quality Award honors U.S. companies for their quality-control efforts.

In some of the ads, General Motors said “167,000 different companies” applied for the award, given for the third time in 1990.

Only 97 actually applied, and only 45 were in the category of manufacturing firms that included Cadillac. The company corrected the ad a short time after it appeared, GM spokesman Harold Jackson said.

“Beyond this mistake, the ads concerning the Baldrige (award) are accurate and not misleading,” a company statement said.

Gardner said the campaign also misrepresented the Commerce Department’s comments that accompanied the award. For instance, a TV spot said Cadillac won the award because of “dedication to owner satisfaction” and a “continued commitment to improvement,” which were not cited by the department, said Gardner.

Jackson said the company won’t sign a consent decree sought by the state, indicating that it will not engage in deceptive advertising. “We don’t believe the advertising violated the law,” he said.