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USA : Details about the historic class-action settlement


On June 28th, a historic class-action settlement has been reached in the United States on behalf of owners and lessees of vehicles equipped with fraudulent devices. The settlement has been submitted to Senior United States District Judge for the Northern District of California Charles R. Breyer. This settlement will provide a roadmap for the European class-action that is being prepared against the German constructor.

Under this settlement, Volkswagen’s accountability to the US market is just under $15 billion. Amongst this colossal amount, 10.033 billion dollars will be allocated to the cash compensation of victims, and 4,7 billion will go to a fund financing environment-friendly activities.

Scope of the agreement:

  • Pursuant to the terms of the settlement, every member of the class who, on September 18, 2015 owned or leased a vehicle equipped with the defeat devices is entitled to compensation.

  • A funding pool of $10,033,000,000 has been created by Volkswagen, from which class members will receive compensation.

  • All attorneys’ fees and costs will be paid by Volkswagen.

Remedy options

  • Owners will have two options:

    o Have Volkswagen buy back their car immediately, receiving the value of the vehicle as of September 2015, as calculated by the National Automobile Dealers Association.

    o Wait to see whether the U.S. Environmental Protection Agency and the California Air Regulations Board approve a fix of the vehicles to reduce emissions. They can then decide whether to sell their car back to Volkswagen or to accept the fix to the emissions, free of charge.

  • Lessees also have two options:

    o Terminate their lease with no early termination penalty, or

    o Keep the vehicle and wait to see whether EPA and CARB approve a fix.

Monetary relief

All class members will also receive a cash payment, which will be calculated as follows:

  • 20% of the price of the vehicle as of September 18Th, 2015

  • An additional fixed amount of $2,986.73.

In any case, the minimum amount in this additional compensation will be $5,100. Owners who sold their cars after September 18, 2015, will be eligible to split the additional payment with the person who purchased the car. Lessees who terminate their leases will receive a payment equal to approximately half of what an eligible owner would receive.

Environmental commitments

Volkswagen has also accepted, pursuant to the terms of the settlement, to pay $2,7 billion into a trust. The purpose of this trust is to support environmental programs throughout the US that will reduce nitrogen oxides in the atmosphere. Volkswagen also must spend $2 billion to promote non-polluting cars and clean technology. EPA and CARB will oversee and monitor Volkswagen’s compliance with these commitments.

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