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Dieselgate: New York, Massachusetts, Maryland take VW to court

POSTED BY Nigel Andretti ON 20 July 2016

THREE US states have filed lawsuits against VW, alleging senior executives at Volkswagen AG – including its former chief executive – covered up evidence the German automaker had cheated on US diesel emissions tests for years.

Hundreds of millions of dollars in fines could result from the civil lawsuits filed on Tuesday if they are successful, a Reuters report said.

New York, Massachusetts and Maryland filed separate, nearly identical lawsuits in state courts, accusing the world’s No 2 automaker of violating their environmental laws. The lawsuits complicate VW’s efforts to move past the “Dieselgate” scandal that has hurt its business and reputation, and already cost it billions of dollars.

The suits outlined more than a decade of efforts by VW to deceive regulators in the United States and Europe, citing internal VW documents.

VW last September admitted using sophisticated secret software in its cars to cheat exhaust emissions tests, with millions of vehicles worldwide affected. The scandal prompted the departure of VW’s CEO and other executives.

The states charged that dozens of VW employees at various levels knew that the company’s “clean diesel” engines could not meet pollution standards in normal driving without compromises to performance or fuel economy. The suits publicly identified for the first time many of these employees and accused them of “unlawful conduct”.

The suits said at least eight employees in VW’s engineering department deleted or removed incriminating data in August 2015 after a senior attorney advised them of an impending order not to destroy documents. The New York suit stated that “some but not all of the data has been recovered”.

Former VW CEO Martin Winterkorn and VW’s former global head of marketing, Christian Klingler, knew by spring 2014 of the existence of unlawful “defeat devices” and “did nothing to prevent both Audi and Volkswagen from repeatedly deceiving regulators,” the New York lawsuit stated.

Volkswagen spokeswoman Jeannine Ginivan said the company already has agreed to spend billions of dollars to address all environmental harms from the excess emissions, adding that it was “regrettable that some states have decided to sue for environmental claims now”.

The states’ claims “are essentially not new and we have been addressing them in our discussions with US federal and state authorities,” Ginivan added.

VW has admitted that it installed improper software that deactivated pollution controls on more than 11 million diesel vehicles sold worldwide, and last month agreed to pay US$15.3 billion (RM61.44 billion) to settle US federal litigation and charges lodged by 44 US states that the company violated consumer fraud laws.

The US Justice Department and Environmental Protection Agency have not yet reached a deal with Volkswagen on fines as part of separate settlement that could lead to an outside monitor overseeing VW’s compliance with American laws. VW also faces a Justice Department criminal investigation.

VW faces potentially billions of dollars more in costs in the United States if it is forced to buy back 85,000 3.0-litre Audi, Porsche and VW cars and SUVs sold since 2009. Last week, California rejected VW’s proposed fix plan.

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