German luxury vehicle makers are facing multiple lawsuits for price fixing and potentially conspiring on numerous aspects of their cars sold in the US, including “clean diesel” technology, costs, suppliers, and pricing. Seeger Weiss is investigating possible antitrust and consumer protection violations and other concerns raised in complaints
Seeger Weiss is part of the steering committee leading a potential class action to bring potential antitrust and consumer protection claims against Volkswagen and Daimler, manufacturers of luxury brands Bentley and Mercedes-Benz, along with three other luxury car manufacturers, Porsche, Audi, and BMW. Their alleged actions led to an increase in the cost of the vehicles, as well as a variety of other outcomes. People who purchased or leased certain models of German Luxury automobiles may be eligible for compensation.
What German Automobiles are Involved in the Price Fixing Lawsuits?
The German manufacturers named in the lawsuit include:
Volkswagen and Daimler have also reportedly admitted they were involved in the conspiracy but have agreed to work with the European Commission in exchange for leniency.
What Were the Issues Involved in the German Vehicle Price Fixing?
According to a report in Der Spiegel magazine, German automotive manufacturers engaged in years of conspiratorial behavior in an effort to increase the prices of German Luxury Vehicles. Der Spiegel launched its investigation following a 2016 raid that involved 50 employees of the authority, aided by local police and regional law-enforcement officers.
The automakers are accused of violating federal and state antitrust laws, unfair competition laws, consumer protection laws, and unjust enrichment laws. The investigation revealed the automakers have been working together since the 1990s, sharing commercially sensitive information and participating in illegal agreements. It is likely discussions also involved the size of tanks for AdBlue fluid for diesel autos.
Did the Price Fixing in German Vehicles Involve Diesel Emissions?
AdBlue is added to diesel engines to neutralize the toxic and potentially fatal chemical they are known to emit. It’s only effective when used properly, which can increase production costs. To avoid this, car makers put AdBlue in gas tanks smaller than required, which resulted in increased pollution. Knowing they were averting regulators; they agreed to limit the size of their tanks and conspire to prevent their actions from being detected.
What Was the Conspiracy to Fix Prices in German Luxury Vehicles?
According to the Der Spiegel report, one of the goals of collusion was to “obstruct competition, with the carmakers agreeing on costs for components or technical details such as convertible roofs.”
The Der Spiegel report revealed that over the course of the last five years, the vehicle manufacturers met during at least 1000 meetings involving more than 200 employees to discuss the development of vehicles, emissions technology, suppliers and markets, and costs. The European Commission (EC) continues to investigate whether anti-competitive and illegal activities occurred.
The scandal is expected to affect carmakers throughout Asia and North America tech companies vying for a larger piece of auto industry’s revenue.
Is it Normal for Auto Manufacturers to Coordinate Activities?
It’s not uncommon for carmakers to discuss how to implement new emissions standards and technologies, but in this case, there is a question of whether the talks among German manufacturers constituted anti-competitive behavior. According to those familiar with the details of the case, had the actions of the car makers been legal, there would’ve been no effort to hide what they were doing.
If the current investigations reveal there was indeed collusion and a breach of EU cartel rules, the German automakers involved face fines of as much as 10% of their global revenue, which would equate to billions of dollars.
Are there Any Class Action Lawsuits for German Car Price Fixing?
In addition to fines levied by the EU, car makers also face potentially costly legal action in the U.S. As a result of discovery of the conspiracy, competition authorities from multiple jurisdictions, including the United States, have launched investigations into the conduct of the automakers and numerous lawsuits have already been filed.
The largest lawsuit is a multidistrict litigation (MDL) antitrust lawsuit filed in the U.S. District Court of the Northern District of California. An MDL is a consolidated lawsuit which combines multiple individual lawsuits into one, larger group so that attorneys and information for each case can be shared for efficiency.
What are the Claims in the German Auto Price Fixing Lawsuits?
The named German auto manufacturers including Audi, Daimler (Mercedes-Benz and Bentley), BMW, Porsche, and Volkswagen have been accused of conspiring to fix prices based on “clean diesel”, parts suppliers, design and other issues.
One class action lawsuit includes four claims for relief, including:
- Violation of Section 1 of the Sherman Act on behalf of Plaintiffs and the Nationwide Class
- Violation of State Antitrust Statutes on behalf of Plaintiffs and the Damage Class
- Violation of State Consumer Protection Statutes on behalf of Plaintiffs and the Damage Class
- Unjust Enrichment on behalf of Plaintiffs and the Damage Class
Though the collusion allegedly occurred over the course of multiple decades and many people were affected several years ago, the statute of limitations did not begin until the collusion was revealed in July 2017.
Have There Been Any Settlements in the German Auto Price Fixing Lawsuits?
The current class action and antitrust lawsuits have not yet been decided; however, the companies have faced multiple fines and penalties in Europe including:
- Germany fined BMW, Daimler, and Volkswagen 100 million Euros for colluding to fix steel prices
- The EU fined Daimler, BMW, Volkswagen, and Audi $1 billion for colluding to limit development and release of auto emission control systems
Investors have also sued Daimler in a German court for $1 billion over diesel cheating or conspiring to trick emissions testing in a related issue known as “dieselgate” and other auto companies may face similar complaints over diesel emissions.
Who Can File a German Luxury Vehicle Price Fixing Lawsuit?
Those who purchased or leased a new vehicle in the United States under one of these brands (Mercedes-Benz, Bentley, Audi, Porsche, Volkswagen or BMW) may have suffered financial damage due to vehicle price fixing and value loss. Owners or Lessees may be eligible for compensation under federal and state antitrust and consumer protection laws for inflated pricing and other injuries.
The law allows plaintiffs to recover compensation for over-pricing and other harm when companies unlawfully collude instead of competing.