VW Paid US Vehicle Owners $9.5B In Dieselgate Scandal, FTC Reports

Volkswagen has paid more than $9.5 billion in settlements to U.S. consumers defrauded in the “dieselgate” scandal.

The Federal Trade Commission (FTC) filed a final report in the Volkswagen dieselgate settlement case Monday, according to NPR.

In the report, attorneys for the FTC praised the efforts of everyone involved with the case and called the compensation portion of the settlement agreement “materially complete.”

“Thanks to the efforts of the parties involved with the consumer settlements — the Court, the FTC, the private bar, the independent Claims Supervisor, and Defendants themselves — this is one of the most successful consumer redress programs in history,” the filing said. 

The FTC said it had imposed tight deadlines and other measures meant to make consumers’ experience in dealing with the settlement as easy as possible, despite its size and complexity.

“To their substantial credit, Defendants successfully managed the settlement administration process despite the enormous claims volume,” the FTC’s attorneys said in the filing. The FTC also praised Volkswagen’s assistance to consumers, saying the company gave “remarkably accurate information” given the scope of the settlement. 

“In fact, Defendants provided accurate information 98% of the time, and most calls successfully addressed the consumer’s concerns,” the filing said.

Beyond that, the FTC said the defendants “paid every one” of the eligible military consumers who pursued claims in the case. 

The FTC’s filing also praised the claims supervisor who had been tasked with monitoring Volkswagen’s compliance with the settlement.

“The Claims Supervisor’s presence, and effective performance, undoubtedly helped facilitate the extremely positive result,” the filing said. 

The terms of the settlement required payments to owners of Volkswagen diesel vehicles, including compensation for the full retail value of the car and other losses caused by the deception, such as sales tax and time spent shopping for a new vehicle, according to court documents. 

“Accordingly, the settlement compensation restored consumers to the position they would have enjoyed without unlawful claims,” the FTC’s attorneys said.

More than 550,000 vehicles in the U.S. were affected by the Volkswagen dieselgate settlement, NPR reported. About 86% of the vehicle owners chose to sell their vehicles back to the manufacturer rather than make modifications.

Individuals who leased the vehicles were expected to receive between $5,100 and $10,000 in compensation, in addition to the cost of the vehicle, TodayHeadline reported.

Volkswagen had for years marketed “clean diesel” vehicles that in reality turned out to be putting out illegal levels of pollutants, according to numerous class action lawsuits. Not only that, the engines — which were used in Volkswagens, Audis and Porches — had been programmed to cheat on emissions tests to mask the issue. 

The Volkswagen dieselgate scandal was exposed in 2015, when the automaker admitted it had cheated emissions tests on 11 million vehicles, according to News 18.

The company was able to cheat on the tests by building engine software that made the vehicles appear to put out fewer pollutants in the lab than when the car was on the road.

The environmental concerns surrounding the Volkswagen dieselgate scandal were addressed through the U.S. Department of Justice, the Environmental Protection Agency, the California Air Resource Board and their partners, according to the filing. 

In addition to compensating consumers, the company has paid billions to make up for environmental damage caused by the Volkswagen dieselgate scandal. In addition to other measures, Volkswagen is investing $2 billion to build electric vehicle charging infrastructure in the U.S.

The company also has vowed to produce mass quantities of electric vehicles in the coming years.

But the German automaker is not out of the woods yet.

In May, the British high court found the automaker used “defeat devices” to cheat emissions testing on Volkswagen diesel vehicles.

The company is facing the largest class action in the U.K., with about 91,000 claimants in England and Wales claiming they had purchased vehicles that had been represented as being compliant with emissions regulations.

In Europe, Volkswagen recalled 8.5 million vehicles, including 2.4 million in Germany and 1.2 million in the United Kingdom, the BBC reported. 

The total bill for the Volkswagen dieselgate scandal is expected to  be in excess of $35 billion worldwide, including the $9.5 billion U.S. settlement, according to News 18. 

In addition, the U.K. Court of Appeal recently rejected an appeal in the Volkswagen emissions scandal, meaning the group litigation may continue.

Do you drive a Volkswagen? Do you think the settlement compensated consumers fairly? Let us know in the comments.

The plaintiffs were represented by Jonathan Cohen, Michelle L. Schaefer, Amanda B. Kostner, Sangjoon “Simon” Han and Megan A. Bartley of the FTC.

The Volkswagen Dieselgate Class Action Lawsuit was FTC v. Volkswagen Group of America Inc., Case No. 3:16-cv-1534, in the U.S. District Court for the Northern District of California, San Francisco Division.

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