Coupons Tentatively OKd in GM Class-Action Suit

A judge Wednesday gave preliminary approval to distribute as much as $5 billion in coupons good toward the purchase of new General Motors vehicles to settle a class-action lawsuit over pickup truck fuel tanks.

The terms of the deal, however, appeared identical to a previous settlement--rejected by a federal court in Pennsylvania--of lawsuits over the same side-mounted gas tanks on GM pickups. The connection between the two court actions was not clear.

GM has faced as many as three dozen class-action suits on the gas tank issue.

About 5 million owners of the 1973-87 model trucks could receive $1,000 each toward the purchase of another GM vehicle under the deal accepted by Louisiana state District Judge Jack T. Marionneaux. The settlement, which will receive a final hearing Nov. 6, covers C-K model pickups equipped with side-mounted gas tanks, which are no longer built.

Critics said the trucks were a fire hazard in side-impact crashes because their fuel tanks were mounted outside the protection of the frame.

GM executives were not available for comment. However, plaintiff’s attorney Pat Pendley said the auto maker’s lawyers had accepted the preliminary settlement. He said it could cost GM more than $5 billion.

The deal is similar to other controversial settlements that offer plaintiffs discount coupons rather than outright cash, thus making defective products a stimulus to sales. A $1,000 coupon for a car, for example, is no costlier to GM than a rebate.

Last year, Toyota tentatively agreed to hand out $1.275 billion in coupons to settle three class-action lawsuits that claimed dealers overcharged customers.

The settlement would require GM to give truck owners $1,000 certificates they could use to buy any new GM car or truck, except Saturns. The settlement also requires GM to give $4.1 million to a national research project to promote fuel system safety. It would exempt trucks that had been scrapped before Wednesday’s order was signed.