GM agrees to coolant class-action settlement

Millions of General Motors customers whose vehicles’ engines allegedly were gummed up by an “extended life” coolant will be eligible for reimbursement under a newly signed class-action settlement.

The massive agreement calls for GM to reimburse class members anywhere from $50 to $800 for repairs necessitated by problems associated with Dex-Cool, an orange-colored fluid sold in millions of GM cars and trucks beginning in 1995.

Depending on the number of claims, the total value of the settlement could run into the hundreds of millions of dollars.

“I think we’ll be inundated with claims,” said Kansas City attorney Jack Brady of Shughart Thomson & Kilroy, who served as co-lead counsel for the plaintiffs. “I think it has the potential to be one of the biggest settlements in the automotive industry, but we’ll just have to wait and see.”

Tom Wilkinson, a spokesman for GM, declined to comment on the settlement.

But in court documents, GM has denied liability and insisted that Dex-Cool protected engines for longer periods than traditional coolants, caused less wear on certain engine parts and provided various environmental benefits. It said that owners who experienced engine and cooling system problems had not followed maintenance instructions.

San Francisco attorney Eric Gibbs, the other lead counsel in the case, estimated that the settlement could cover as many as 20 million initial and secondary buyers of GM vehicles that used Dex-Cool. It remains unclear how many of those buyers will make a claim.

Clear Channel Gets Favorable Deal Ruling

A Texas judge issued a temporary restraining order barring banks from interferring with or thwarting the closing of the proposed $19.5 billion buyout of Clear Channel Communications Inc., the nation's largest radio station operator.

The order by Bexar County Judge John D. Gabriel was issued just hours after Clear Channel and the private equity buyers, led by Bain Capital and Thomas H. Lee Partners LLC, filed suit in Texas and New York to force the banks to lend money promised in the deal first proposed 18 months ago.

They accused the banks of putting unreasonable terms on the loan in an effort to bust the deal, violating the commitments they made earlier.

If the deal closes, the banks could take $3 billion to $4 billion in writedowns. They are likely to have trouble reselling the debt in a credit market that has seized up.

The Texas judge found there was evidence Clear Channel and the equity firms will prevail in their case, and "harm is imminent and immediate," justifying the restraining order.

San Antonio-based Clear Channel, which is also a major billboard operator, hoped to complete the deal by Monday. Further delays trigger fees or potentially destroy the buyout altogether.