Germany's highest civil court has ruled German car giant Volkswagen must pay compensation to a motorist who bought one of its diesel minivans fitted with emissions-cheating software on the basis that the company’s behaviour was “unethical”.
In its ruling, the Federal Court of Justice said anyone who purchased a Volkswagen automobile equipped with software that manipulated emissions tests is entitled to financial compensation and can return the vehicle and receive financial reimbursement from the automaker. The car in question’s mileage will be taken into account when calculating recompense.
In July, the Federal Court of Justice will take up yet further cases linked to the scandal, including suits against car dealers who sold the offending Volkswagens.
Defeat Devices
In September 2015, Volkswagen admitted to the US Environmental Protection Agency that it’d installed software in 11 million vehicles worldwide that could detect emissions test scenarios and change the vehicle's performance accordingly to improve results, allowing the firm’s cars to cheat emissions tests.
The scandal, dubbed Dieselgate, led to major controversy - particularly when similar workarounds were later discovered at other car giants. Volkswagen has been embroiled in litigation ever since.
To avoid a class-action lawsuit, Volkswagen Group recently agreed to pay damages to 235,000 car owners in Germany, which could cost the firm up to US$905 milllion - the company settled similar actions for US$25 billion in the US and other countries in 2016, and in autumn 2019 agreed to pay out AU$127 million (US$83 million) as a settlement for multiple lawsuits launched in Australia, and in January a Canadian court ordered Volkswagen to pay nearly CAN$2 million (US$1.4 million) on top of the CAN$2.4 billion it’d already paid in the country, a sum 26 times the highest fine ever for a Canadian environmental offence. Around 90,000 motorists in England and Wales have brought action against Volkswagen as well as Audi, Seat and Skoda, also owned by Volkswagen Group. In April, the High Court agreed to hear their case, after a judge ruled software installed in the cars were indeed "defeat devices" under European Union rules.
In all, Volkswagen has paid out over €30 billion in fines, compensation and buyback schemes worldwide since the scandal first broke. Numerous other car companies have also paid fines and recalled thousands of vehicles equipped or believed to be equipped with emissions-cheating software.
German prosecutors have also brought charges against top Volkswagen staff over the scandal - chief executive Herbert Diess and supervisory board chief Hans Dieter Poetsch agreed to an out-of-court settlement of €9 million earlier this month. It is not clear whether Martin Winterkorn, Volkswagen's chief executive from 2007 to 2015 who stepped down after the scandal came to light, will also be forced to pay a penalty.