German auto giant Volkswagen AG yesterday faces the threat of a hefty “dieselgate” payout in Britain after a court on Monday ruled in favor of more than 90,000 Volkswagen drivers whose vehicles cheated emissions tests.
Following adverse rulings and compensation payouts elsewhere, the British High Court ruled that Volkswagen is also liable in Britain.
The ruling adds pressure on Volkswagen just after the automaker last month said that it is preparing to shutter most of its European plants, joining a slew of other automakers as the COVID-19 pandemic disrupts supply chains and sends demand plummeting.
The British judgement concerned “defeat devices” installed in about 1.2 million Volkswagen, Audi, SEAT and Skoda diesel vehicles in Britain, which artificially lowered emissions.
The court found that the devices were a “fundamental subversion” of EU tests designed to limit noxious pollutants, and is to rule later on compensation to the owners.
Volkswagen admitted in 2015 to fitting 11 million vehicles worldwide with software to make engines appear less polluting in regulatory tests than in real driving conditions.
The legal fallout has so far cost Volkswagen more than 30 billion euros (US$32.58 billion) globally in costs, fines and compensation, most of it in the US and Germany.
‘DAMNING JUDGEMENT’
Gareth Pope, head of group litigation at Slater and Gordon, which represents about 70,000 of the British claimants, welcomed the “damning judgement.”
It “exposes Volkswagen’s disregard for EU emissions regulations and public health in pursuit of profit and market dominance,” he said.
Pope said that Volkswagen must end the “shameful episode” and settle with the plaintiffs, but the automaker said that it would consider grounds for appeal.
“While Volkswagen is disappointed that the outcome was not in our favor, the judgement relates only to preliminary issues,” it said in a statement.
It was still to be determined whether vehicle owners had suffered actual losses, Volkswagen said.
NOT GIVING IN
“We will continue to defend our position robustly,” it added.
The ruling was “hugely significant” for vehicle owners “battling for four years to hold Volkswagen to account,” said Bozena Michalowska Howells of the law firm Leigh Day, which also represents claimants in Britain.
She called on Volkswagen to “do the right thing and put their customers first by entering into settlement negotiations,” saying that it would avoid “further years of litigation.”
About five weeks ago, Volkswagen struck a compensation deal with consumer groups in Germany that represent owners of vehicles caught up in “dieselgate.”
The 830 million euro compensation deal fended off a collective lawsuit brought by 400,000 diesel vehicle drivers.
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