King: Rethink GM bankruptcy plan

By John O'Brien | Jul 1, 2009


MONTGOMERY, Ala. (Legal Newsline) - Alabama Attorney General Troy King is appealing a part of General Motors' bankruptcy plan that he says will harm former GM employees on workers' compensation.

King filed the appeal with the U.S. Department of the Treasury Tuesday, seeking to ensure the 43 Alabamians who worked at GM and are now on workers' compensation will be provided for. King says the bankruptcy plan provides a continuation of GM's obligations in 22 states, but not in Alabama, Georgia New Jersey and Oklahoma.

"Allowing General Motors to discharge its financial problems onto states like Alabama compounds the fiscal irresponsibility that created this crisis in the first place, and shifts responsibility for the bailout to those who bear no responsibility for creating it - the people of my state," King wrote.

A bond covering eight former employees will be depleted in less than 12 years, according to the Alabama Department of Industrial Relations, and a group of 34 former employees will see their fund, which has a cap near $9 million, be exhausted in approximately 22 years.

One other former employee was injured before 1983 and wil not receive any compensation under the bankruptcy plan.

King said he made the decision to act after a conference call with members of other state attorney general offices.

King also wrote the bankruptcy plan "jeopardizes the claims of many Alabamians who have worked and who now receive workers' compensation benefits unrelated to General Motors."

From Legal Newsline: Reach John O'Brien by e-mail at john@legalnewsline.com.

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