Volkswagen Reaches $157.45M Settlement with States in Emissions Scandal

Public Health Watchdog Breaking News
Public Health Watchdog Breaking News

On March 30, 2017, Volkswagen, Audi, and Porsche announced that they have agreed to pay a total of about $157.45 million in penalties to 10 states to resolve environmental claims stemming from the diesel emissions cheating scandal, as well as to resolve some consumer claims that were not covered in a prior settlement.

Volkswagen said that the companies and their American subsidiaries reached the deal to put to rest environmental claims brought by Connecticut, Delaware, Maine, Massachusetts, New York, Oregon, Pennsylvania, Rhode Island, Vermont and Washington. The states brought the claims over the use of so-called defeat devices that hide the true levels of nitrogen oxides being emitted by purportedly “clean” diesel vehicles, according to Law360.

Settlement Resolves Claims from 10 States

The settlement also ends consumer protection claims by the states for injunctive relief or restitution involving the cars that feature 3.0 liter diesel engines. Those claims were not included in a $603 million deal struck last year with 44 states, Washington, D.C., and Puerto Rico, Volkswagen said.

Parker Waichman notes that Volkswagen’s actions are part of a pattern in recent years of automakers denying defects and misleading regulators and the public about the existence of and seriousness of defects.

The deal requires Volkswagen to offer at least three new electric car models across its brands, including two electric SUVs, by 2020. Court documents indicate that Volkswagen had earlier committed to doing this in California.

California has unique power to set its own emission standards, as long as they meet or exceed federal standards, Law360 reports. States that cannot develop their own vehicle emission standards can adopt those laid out by California.

Even before the existence of the Environmental Protection Agency (EPA), California had produced air quality standards. Before those standards, the Los Angeles metropolitan area had severe air quality problems because this sprawling metro area relies more heavily on automobiles than do other large cities. New York and Chicago, which, along with Los Angeles are the nation’s three largest cities, have strong mass transit systems, which cut down on the number of cars on their roads. Los Angeles’s air quality problem is made worse by less meteorological conditions that can lead to unhealthy air being trapped over the metropolitan area.

New York Attorney General Eric Schneiderman’s office announced the 10-state deal, saying it marks the first time the states have won environmental penalties from an automaker under their state vehicle emission laws.

“Historically, enforcing vehicle emission standards has been done primarily by the federal government,” Schneiderman’s release said. Schneiderman said this precedent “is particularly vital now, when President Trump has vowed to defund federal environmental enforcement and undo federal environmental protections, which would leave states like New York and California as the first line of defense for the environment.”

Court documents indicate that the money will be allocated as follows: Connecticut receives about $14.85 million, Delaware about $1.45 million, Massachusetts about $20 million, Maine about $5.16 million, New York about $32.53 million, Oregon about $16.22 million, Pennsylvania about $30.43 million, Rhode Island about $4.1 million, Vermont about $4.24 million and Washington about $28.42 million.

Litigation in the Emissions Scandal

The states’ claims against Volkswagen have been in court in a multidistrict litigation over the emissions scandal. Under the settlement, many of the cases will be sent back to state courts for settlement purposes.

Earlier in March, Volkswagen entered a guilty plea in federal court in to conspiracy to defraud the U.S., wire fraud, and Clean Air Act violations. The plea was part of a deal with the U.S. Department of Justice. The settlement with the DOJ and U.S. Customs and Border Protection also contains measures to fortify the company’s compliance systems.

The guilty plea was a step toward resolving the crisis that began in September 2015, when the EPA and the California Air Resources Board accused Volkswagen of using defeat devices to evade federal emissions tests for diesel vehicles. Volkswagen has heavily promoted its “clean diesel” technology and people had paid extra for these vehicles. Volkswagen has since admitted fault and revealed that the software came preloaded in millions of its diesel vehicles. Nearly 600,000 of the vehicles were sold in the U.S. The software allowed the vehicles to emit the advertised level of toxins during emissions testing and then emit far higher amounts when on the road.

Legal Help for Owners of Volkswagen Diesel Vehicles

If you own a Volkswagen, Porsche, or Audi diesel vehicle involved in emissions cheating, the attorneys at Parker Waichman can advise you about the remedies available to you. For a free, no obligation consultation, fill out the online contact form or call 1-800-YOURLAWYER (1-800-968-7529).