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US files civil suit against Volkswagen for violating clean air laws US files civil lawsuit against Volkswagen for violating clean air laws
(about 1 hour later)
The US Department of Justice on Monday filed a civil suit against Volkswagen AG for allegedly violating the Clean Air Act by installing illegal devices to impair emission control systems in 600,000 vehicles. The US government has sued Volkswagen over allegations that the German company illegally installed special software to cheat emission tests.
The allegations in the lawsuit carry penalties that could cost Volkswagen billions of dollars, a senior justice department official said. Related: The Volkswagen emissions scandal explained
“The United States will pursue all appropriate remedies against Volkswagen to redress the violations of our nation’s clean air laws,” said assistant attorney general John Cruden, head of the department’s environment and natural resources division. The lawsuit filed by the Department of Justice in federal court in Detroit on Monday claims that VW violated the Clean Air Act by installing “defeat devices” in almost 600,000 diesel vehicles in the US.
The lawsuit will be filed in the eastern district of Michigan and then transferred to northern California, where class-action lawsuits against Volkswagen are pending. After being caught by the regulator in September, VW admitted installing the software, which was designed to trick regulators into believing its cars are less polluting than they really are by producing low emissions only when undergoing official tests, in more than 11m vehicles across the world.
It does not preclude the justice department from pursuing criminal charges against Volkswagen, a senior department official said. The allegations in the lawsuit, brought on behalf of the Environment Protection Agency (EPA) carry penalties that could cost Volkswagen more than $30,000 per vehicle, which could total as much as $18bn.
The emissions scandal has already wiped tens of billions of euros off VW’s share price, and analysts have warned that the total cost of the scandal could be as high as €78bn ($84.4bn, £57.4bn), which would be 60% more than the Deepwater Horizon disaster cost BP. VW has so far set aside €6.7bn to cover the cost of the scandal.
Related: Meet John German: the man who helped expose Volkswagen's emissions scandal
John Cruden, assistant attorney general and head of the DoJ’s environment and natural resources division, said: “Car manufacturers that fail to properly certify their cars and that defeat emission control systems breach the public trust, endanger public health and disadvantage competitors.”
Cynthia Giles, assistant administrator for the EPA’s office of enforcement and compliance assurance, said: “With today’s filing, we take an important step to protect public health by seeking to hold Volkswagen accountable for any unlawful air pollution, setting us on a path to resolution.
“So far, recall discussions with the company have not produced an acceptable way forward. These discussions will continue in parallel with the federal court action.”
The civil lawsuit, which is being filed in the eastern district of Michigan before being transferred to California where class action lawsuits against the company are pending, does not preclude prosecutors from bringing criminal charges against VW executives, a DoJ official said.
“We’re alleging that they knew what they were doing, they intentionally violated the law and that the consequences were significant to health,” the DoJ official told Reuters.
Barbara McQuade, US attorney for the eastern district of Michigan, said: “Today’s complaint is the first stage in bringing Volkswagen to justice for failing to disclose the defeat device while seeking certification for its diesel vehicles from EPA’s Office of Transportation and Air Quality in Ann Arbor.
“The alleged misrepresentations allowed almost 600,000 diesel engines to emit excessive air pollution across the country, harming our health and cheating consumers.”
VW did not immediately respond to requests for comment about the lawsuit.
The company has repeatedly apologised for the scandal, and several senior executives have resigned. Former CEO Martin Winterkorn quit after saying he was shocked and stunned that “misconduct on such a scale was possible” and the company was in the midst of a “grave crisis”.
Michael Horn, the boss of VW in the US, apologised to lawmakers in Washington in October and said the company was “determined to make things right”.
“Our company was dishonest, with the EPA and the California Air Resources Board, and with all of you and in my German words, we have totally screwed up,” he told the House committee on energy and commerce. “We have to streamline our processes, and this company has to bloody learn and use this opportunity in order to get their act together.”
Regulators in other countries, including India, South Korea and Germany, are also carrying out investigations into the VW scandal.