Volkswagen & Audi 2.0-Liter Emissions Settlement Provides Nearly $15 Billion for Affected Consumers and Environmental Remediation

By: Seeger Weiss on June 29, 2016

June 28, 2016–A proposed settlement of the Volkswagen “Clean Diesel” Marketing, Sales Practices, and Products Liability Litigation has been filed in the Northern District of California, where the federal multidistrict litigation is currently being overseen by Judge Charles M. Breyer.

If approved, the settlement will ensure Volkswagen and Audi 2.0-liter TDI owners and lessees receive substantial compensation and that remediation for the environmental impact of the excessive emissions will occur.

If approved, the proposed settlement will be the largest consumer auto industry class action settlement in U.S. history, providing more than $10 billion for affected consumers and an additional $4.7 billion to remediate environmental damage caused by the vehicles.

It’s been nearly a year since the United States Environmental Protection Agency issued a Notice of Violation of the Clean Air Act to Volkswagen AG, Audi AG, and Volkswagen Group of America, Inc., in September, alleging four-cylinder VW and Audi diesel cars with model years 2009 – 2015 were equipped with computer software in their “Clean Diesel” cars to circumvent EPA emissions standards for air pollution. The EPA called it a “defeat device,” and an enforcement investigation was initiated.

During this time, a dedicated team of plaintiffs’ attorneys from firms all over the country, including Seeger Weiss partners Chris Seeger, Dave Buchanan, and TerriAnne Benedetto. Chris Seeger, who sat on the Plaintiffs’ Steering Committee, helped negotiate this historic settlement.

Under the proposed agreement, owners of Volkswagen and Audi vehicles affected will be given the option of a buyback or lease termination, or an emissions modification that ensures the vehicle no longer generates excess nitrogen oxide emissions. The settlement will affect approximately 475,000 vehicles. Vehicle owners will receive additional cash compensation, regardless which option they choose.

Volkswagen will also pay $2.7 billion into a mitigation trust fund for environmental remediation and another $2 billion to promote Zero Emissions Vehicle technology. Additionally, the company is required to pay money into a mitigation trust if it fails to remove or modify at least 85% of the affected vehicles by the end of June 2019.

The terms of the proposed class settlement are summarized as follows:

  • Vehicle Buyback is available to eligible class members. If they choose this option, they will receive a payment equal to the September 2015 National Automobile Dealers Association (“NADA”) Clean Trade-In value of their vehicle, adjusted for their options and mileage. Certain owners will be eligible for loan forgiveness, and certain lessees will have the option of terminating their lease without penalty. Buybacks can begin as early as fall 2016.
  • Owners and lessees who choose the Vehicle Fix option can wait to see if an emissions modification is approved by the EPA and CARB, and if so, can modify their non-compliant vehicle free of charge. They will also receive extended warranties and “lemon law” protections. If the modification is not approved, lessees and owners can participate in the Buyback Program or withdraw from the settlement.
  • In addition to participation in the Buyback or Vehicle Fix Programs, class members will also receive cash payments based on a formula outlined in the settlement agreement. Most payments will range from $5100 to $10,000 per vehicle.

To learn more about the settlement or to determine if you have an eligible vehicle, visit VWCourtSettlement.com. If the Court grants preliminary approval of the settlement on July 26, 2016, the site will feature a secure settlement look-up tool that can help you determine, based on your vehicle’s VIN number, whether you are eligible. When and if the settlement receives final approval, the claims process will open to all Volkswagen and Audi 2.0-liter owners and lessees without delays on appeal.

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