German court rules VW, Audi must pay vehicle owners in emissions cheating class action
Germany’s highest civil and criminal court has ruled that Volkswagen must pay drivers who owned vehicles that were equipped with emissions defeat devices between 5% and 15% of the purchase price of their vehicle. The decision has the potential to cost Volkswagen and other automakers who installed emissions devices on their vehicles – such as Audi and Mercedes Benz – millions of Euros.
Germany’s Federal Court of Justice ruling involved a class action lawsuit filed against Audi, Mercedes Benz, and Volkswagen by diesel vehicle owners in Germany. The lawsuit alleged that these automakers illegally installed emissions defeat devices on the effected vehicles in order to conceal their excess emissions levels from drivers and regulators. Vehicle owners alleged that the presence of this emissions cheating software on their cars negatively effected the worth and resale value of their automobiles.
Previously, German state courts had dismissed claims in the class action lawsuit against VW and other automakers, and referred them to lower courts of appeal for additional hearings. The ruling by Germany’s Federal Court of Justice overturned these lower court dismissals, and ordered Volkswagen and other automakers to prove that the emissions defeat devices installed on the effected models were not illegal.
Attorneys for Volkswagen, Audi, and Mercedes Benz argued that the emissions devices, which are only activated under certain temperature conditions, were necessary to protect the vehicles, and thus, were allowed under European law. Because European vehicle regulators had allowed such “thermal window software programs” until last year, installing them could not be considered illegal, lawyers for the automakers argued.
The Federal Court of Justice had previously ruled that automakers could only be held accountable for the installation of emissions defeat devices on vehicles if they had knowingly installed an illegal device on their automobiles. However, the German court reversed its position after the European Court of Justice ruled that vehicle owners whose cars were equipped with defeat devices were entitled to compensation.
In addition to the millions of Euros in damages to vehicle owners that these companies will be forced to pay as a result of the decision, the court’s ruling also has the potential to effect other emissions cheating lawsuits filed against VW, Audi, and other automakers in Europe involving the sale of diesel vehicles in which emissions defeat devices was installed.
Former VW executive sentenced in Dieselgate plea agreement
In a separate ruling, Rupert Stadler, the chairman of Audi from 2007 to 2018, received a suspended sentence and was ordered to pay a fine of €1.1 million ($1.2 million) by another German court for his role in the Dieselgate emissions cheating scandal.
Stadler agreed to a plea deal with prosecutors in May 2023 in which he pled guilty to knowing about Audi’s diesel emissions cheating and for failing to stop the sale of diesel vehicles that were outfitted with emissions cheating software. Stadler was the first former Volkswagen Group executive to admit to knowing about illegal software used by the automaker to evade emissions regulations on its vehicles in Europe and the U.S.
Two of Stadler’s co-defendants in the case – former Audi board member Wolfgang Hatz and former Audi engineer Giovanni Pamio – were also sentence for their role in connection with the emissions cheating scandal. Hatz received a two-year suspended sentence and was ordered to pay a fine of €400,000 ($438,000); Pamio was handed a suspended sentence of nine months along with a €50,000 ($55,000) fine.