VW Emissions Cheating Scandal – UPDATE

April 20, 2017

In the aftermath of the emissions cheating scandal, Volkswagen AG is on clean-up, figuratively and literally, after formally pleading guilty in Michigan federal court to three criminal charges on March 10, 2017, and agreeing to pay $4.3 billion in penalties as per the settlement agreement reached with the U.S. Department of Justice and U.S. Customs and Border Protection in January.  As well, under a consent decree issued by the USDOJ and EPA in conjunction with the settlement, VW must also meet a recall rate of 85 percent and pay $225 million to remediate the environmental effects of the excess emissions.

The VW MDL is In re: Volkswagen “Clean Diesel” Marketing, Sales Practices and Products Liability Litigation, case number 3:15-md-02672, in the U.S. District Court for the Northern District of California

Volkswagen’s auto dealers, who have been left on their own to deal with outraged consumers, are not left out of the ring. A $1.6 billion settlement benefiting those impacted by the emissions cheating scandal was reached in January and the court entered an order granting final approval of the Volkswagen Branded Franchise Dealer Class Action Settlement Agreement and Release on January 23, 2017.

The case is Napleton Orlando Imports LLC et al., v. Volkswagen Group of America Inc. et al., case number 3:16-cv-02086, in the U.S. District Court for the Northern District of California.

On the criminal action, six high-ranking executives at Volkswagen, all in Germany, have been indicted and are charged with crimes including conspiracy to defraud the U.S. and the company’s customers, violations of the Clean Air Act and wire fraud. One executive, Oliver Schmidt, who was the general manager of VW’s environmental and engineering office in Michigan, was arrested in January while visiting Miami. His trial will start on April 18, 2017. The others are believed to be still in Germany.

The case is United States of America v. D-8 Volkswagen AG, case number 2:16-cr-20394, in the U.S. District Court for the Eastern District of Michigan.

And finally, Volkswagen’s investors have filed their own lawsuits, charging Volkswagen with intentionally lying and misleading its investors. Litigation is still ongoing, as Judge Breyer set a briefing schedule mid-March for Volkswagen’s motion to dismiss an amended complaint, setting the last briefs for June 5, and the putative class subsequently filed their own motion for partial summary judgment, asking to complete briefing by April 5.

The investors’ cases are City of St. Clair Shores Police and Fire Retirement System v. Volkswagen AG et al., case number 1:15-cv-01218, in the U.S. District Court for the Northern District of California; Travalio et al. v. Volkswagen AG et al., case number 2:15-cv-07157, in the U.S. District Court for the District of New Jersey; The George Leon Family Trust v. Volkswagen AG et al., case number 2:15-cv-07283, in the U.S. District Court for the District of New Jersey; Charter Township of Clinton Police and Fire Retirement System v. Volkswagen AG et al., case number 2:15-cv-13999, in the U.S. District Court for the Eastern District of Michigan and Wolfenbarger v. Volkswagen AG et al., case number 1:15-cv-00326, in the U.S. District Court for the Eastern District of Tennessee.