In re Volkswagen 'Clean Diesel' Marketing, Sales Practices, and Products Liability Litigation Lawsuit

In re Volkswagen "Clean Diesel" Marketing, Sales Practices, and Products Liability Litigation

Product and manufacturer

The litigation concerned diesel passenger vehicles sold in the United States by Volkswagen Group, the German automobile manufacturer, which had marketed its TDI range as "clean diesel" technology — fuel-efficient engines positioned as an environmentally friendly alternative to gasoline. The affected cars were fitted with turbocharged direct-injection diesel engines, principally the EA189 2.0-litre four-cylinder installed in models such as the Jetta, Passat, Golf, and Beetle, together with a separate group of 3.0-litre V6 TDI engines in larger Volkswagen, Audi, and Porsche models. Volkswagen deployed the engine software across a very large fleet of vehicles worldwide, with roughly 482,000 affected vehicles sold in the United States.

Defect and harm

The central allegation was that the engine control software was programmed to recognize laboratory emissions testing and to run full exhaust-aftertreatment only while being tested. During ordinary driving, the same software permitted the engines to emit nitrogen oxides at multiples of the level allowed under U.S. law. Nitrogen oxides are harmful air pollutants associated with respiratory and cardiovascular disease, so the excess emissions had both an environmental dimension and a public-health dimension. For the plaintiffs, the harm took two forms: the public interest in the excess pollution, and private injury in the shape of vehicles that did not meet the emissions representations on which they had been sold, with a resulting drop in resale value and the cost of corrective measures.

Litigation course

The United States Environmental Protection Agency served a Clean Air Act notice of violation on Volkswagen in September 2015, and criminal and civil government actions followed. Owner, state, and other private claims were consolidated as In re Volkswagen "Clean Diesel" Marketing, Sales Practices, and Products Liability Litigation, MDL No. 2672 (docket 3:15-md-2672), in the United States District Court for the Northern District of California, before Judge Charles R. Breyer; the consolidated docket was filed on September 23, 2015. The MDL brought together more than five hundred class actions and other filings. A federal false-advertising action by the Federal Trade Commission was folded into the consolidated litigation so that the agency could participate in a global resolution, and the Department of Justice's parallel enforcement proceeded alongside the MDL.

Outcome

In 2016 Volkswagen agreed to a civil settlement providing for buybacks of affected 2.0-litre vehicles, retrofits where an approved repair became available, and compensation to owners; a federal judge approved the settlement in October 2016. The matter is accordingly recorded as resolved in 2016 by settlement. The MDL remains formally open for residual matters.