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New emissions blow for VW as German court supports claims for damages



KARLSRUHE, Germany (Reuters) – Volkswagen (VOWG_p.DE) must pay compensation to owners of vehicles with rigged diesel engines in Germany, a court on Monday said, and struck a new blow against the car manufacturer almost five years after its emissions scandal broke out.

FILE PHOTO: A cartoon of a VW logo smashing the corona virus is shown on a building in Volkswagen’s headquarters to celebrate the reopening of the plant during the spread of the coronavirus disease (COVID-19) in Wolfsburg, Germany, April 25, 2020. REUTERS / Fabian Bimmer

Germany’s highest court for civil litigation, which allows owners to return vehicles for partial repayment of the purchase price, serves as a template for about 60,000 lawsuits that are still pending in lower German courts.

In September 2015, Volkswagen admitted to cheating emissions testing on diesel engines, a scandal that has already cost it more than € 30 billion ($ 33 ​​billion) in regulatory fines and vehicle compensation, mostly in the United States.

US authorities banned the hit cars after the cheat software was discovered, triggering damages claims.

But in Europe, vehicles remained on the roads, which led to Volkswagen arguing for compensation claims where there were no qualifications. Instead, European authorities forced the company to update its engine control software and fined it for fraud and administrative decay.

Volkswagen said on Monday that it would urgently cooperate with motorists on an agreement that would see them stick to the vehicles for a one-time replacement.

It did not give an estimate of how much the German Federal Court’s decision, the Bundesgerichtshof (BGH), could cost.

Volkswagen shares were 0.5% lower at 1040 GMT. BGH’s presiding judge had signaled earlier this month that he saw reasons for compensation.

COSTS

“The BGH judgment draws a final line. This creates clarity in BGH’s views on the underlying issues in the diesel procedure for most of the 60,000 cases that are still pending, “Volkswagen said.

A lower court in the city of Koblenz had previously decided that the owner of a VW Sharan minivan had suffered pre-mediated damage, giving him the right to reimbursement less a discount for the mileage that the motorist had already benefited.

The court said at that time that he should be awarded € 25,600 for the purchase of used car which he made for € 31,500 in 2014.

“In principle, we have upheld the ruling of the Koblenz High Court,” BGH President Federal Judge Stephan Seiters said.

Volkswagen requested that the decision be set aside altogether by the High Court, while the complainant had appealed that the deduction be removed.

A spokesman for Volkswagen said that outside Germany still told more than 100,000 claims, including 90,000 cases in the UK.

The car manufacturer also said it had paid out a total of € 750 million to more than 200,000 separate claimants in Germany who had opted for individual claims and instead joined a lawsuit filed by a German consumer group.

The carmaker said last month it would set aside a total of $ 830 million for that deal.

In a separate court last week, Volkswagen agreed to pay EUR 9 million to end the proceedings against its chairman and chief executive, who were accused of withholding market-moving information before the emissions scandal emerged.

Reporting by Ursula Knapp and Ilona Wissenbach; Writing by Ludwig Burger; Editing by Maria Sheahan and Mark Potter

Our standards:Thomson Reuters Trust Principles.

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