$10 billion U.S. Settlement: Green Light for the U.K.?

U.S. District Judge Charles Breyer is likely to approve of the settlement offer made by VW in the cheating emissions scandal

The never-ending Volkswagen saga could be coming to a head in the U.S. as Judge Charles Breyer is set to approve the proposed $10 billion settlement in the U.S.

The settlement proposal is offered to all affected victims in the U.S. of VW’s use of the so-called “defeat device” software in the 2.0 litre diesel vehicles. The alleged “defeat device” allowed diesel vehicles to pollute 40 times more NOx emission than the legal limit, and the decision is a long-awaited judgment that should see affected victims in the U.S. finally get the justice they deserve.

Nature of the settlement

The $10 billion settlement plan is for buybacks and compensation for vehicle owners. It’s believed that VW is offering each owner between $5,100 and $10,000 in compensation on top of a repurchase price. The settlement includes VW’s $2.7 billion fine payable to the Environmental Protection Agency and also $2 billion for further environmental incentives specifically promoting zero-emission technology. If approved, the settlement will reportedly be the most costly air pollution settlement ever to be made in the U.S.

Judge Breyer

It seems likely that Judge Breyer will grant in favour of the proposed settlement as he stated that it was “imperative” to act quickly. This is possibly because the remedial action has been slow, and the settlement offer will seek to bring closure on the case for many U.S. victims.

Judge Breyer also granted preliminary approval for a $1.21 billion settlement with VW’s brand dealers in the U.S. which shows that it’s likely that the same judgment will be made in favour of the U.S. vehicle owners.

Unsatisfactory compensation?

However, NBC Washington reports the discontent amongst some of the affected VW vehicle owners. Mark Dietrich, an Audi owner, states that the “settlement does not go far enough” to compensate him.

We also know that different States in the U.S. have different laws which could affect the viability of the settlement as well. For example, we were advised by a U.S. Attorney in Texas that triple damages can be awarded in cases of fraud, and this fits the bill. This could mean that, under some individual State laws, that vary from State to State, some victims may be getting less than they would be eligible to under their own State laws.

How can any Attorney in America advise their clients to accept a third of the compensation they might actually be entitled to?

VW to continue offering repairs?

Aside from the settlement offer, there are talks that VW may be able to repair the vehicles as well, which is set to be subject to U.S. regulators’ strict approval. As we know, reports are coming in from post-recall vehicles, and a lot of problems have been identified. If there were future issues with vehicles, some owners may associate the issue with the “defeat device” software.

Whilst not conclusive, it could be a better option to compensate victims of the scandal in the settlement offer and bring the action to a close.

Potential criminal liability

The civil settlement does not wash VW’s hands clean as they are still facing potential fines that are set to cost them billions of dollars. The “criminal investigation is active and ongoing”, said Deputy Attorney-General, Sally Yates. It seems the $16.2 billion that VW has set aside for potential fines from the scandal may not be adequate if criminal liability is also found…

Global legal action

Even if the U.S. Judge Breyer agrees with the proposed offer, and therefore approves of the settlement, it will not be the end to VW’s nightmare. VW are still defending legal proceedings globally, from Europe to Asia. Just recently, 6,000 lawsuits were filed against the German manufacturer in the Braunschweig Court in Germany, and we’re acting for thousands of people here in the UK as well.

Claims are still very much alive, regardless of the U.S. settlement offer.

The situation in the U.K.

It seems that VW are not ready to make settlement offers or proposals in Europe, especially in the U.K. Since the scandal unravelled in September last year, VW has only fixed around 10% of the affected vehicles.

Judge Breyer’s approval will not give the U.K. a green light to bring a settlement here, as it’s a totally different jurisdiction. It could, however, put more pressure on VW to offer compensation for their U.K. customers as well.

It’s ridiculous that VW has yet to offer any ‘real’ compensation for their U.K. customers, but that will not deter us to help you seek the justice and compensation you deserve.

We remain confident we will win our action, and our view is simple: it’s just a matter of time.

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