VW Faces Another Wave of Diesel Lawsuits in Europe
When will Volkswagen’s 5-year-old diesel cheating scandal end? Not quite yet, for sure.
VW admitted in 2015 it rigged 11 million diesels to evade emission laws. So far it has paid out some $30 billion in fines, compensation and environmental remediation for rigging 11 million diesels to evade emission standards.
More than 80% of those penalties had to do with a mere 555,000 doctored diesels that VW sold in the U.S.
But now the European Union’s top court has opened the door to a wave of lawsuits filed by disgruntled customers, 8.5 million of whom bought cheater diesels in all of the EU’s 27 member countries.
The EU’s Court of Justice ruled today that consumers who bought those rigged diesels may sue VW through their courts where they live and not just in Germany, where the cheating occurred.
In the U.S. non-compliant VW diesels were ordered off the road. The company has argued all along that its affected customers in Europe suffered no such loss, because they were allowed to continue driving their noncompliant vehicles.
VW also launched a recall in 2016 to install free software updates to bring the 8.5 million diesels into regulatory compliance (the same approach turned out to be unfeasible in the U.S., where diesel limits are more stringent).
The EU high court’s decision doesn’t open up VW to the likelihood of U.S.-style, big-ticket settlements involving car buybacks or general owner compensation. But it does enable owners to more easily sue to recoup the difference between what they paid for an emission-compliant car and the lower value of the non-compliant vehicle they actually received, Reuters reports.
Impact to Come
VW already faces several class-action-type lawsuits from disgruntled customers in Austria, Germany and the U.K. Today’s ruling invites owners living in the remaining 24 EU member nations to jump into the fray.
Does this mean VW is about to be hammered again for its diesel cheating? Yes and no. The size of per-vehicle settlements allowed by the high court’s decision won’t be nearly as big as those collected by owners in the U.S. But with the potential for 15 times the number of cars involved, VW’s bill could add up fast anyway.
More important, today’s decision adds to the continuing dribble of new legal woes for VW. Last month a U.S. appellate court panel ruled that the carmaker’s settlement of federal regulatory diesel cheating charges doesn’t shield the company from similar lawsuits by state and local jurisdictions.
The judges in that decision acknowledged that their ruling, which VW plans to appeal, might expose VW to “staggering” new liability. So no, VW’s diesel travails are not over.
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