Volkswagen Sued Over False ‘Clean Diesel’ Advertising

FTC said US consumers suffered “billions of dollars in injury” as a result of deception by Volkswagen.

Volkswagen emblem. (Photo: iStockphoto)

The US Federal Trade Commission (FTC) has sued Volkswagen Group of America, saying the US arm of the German automaker falsely advertised more than a half million diesel vehicles as environmentally friendly when it knew they were emitting excess pollution.

The FTC filed suit against the wholly owned Volkswagen AG unit in US District Court in San Francisco. The agency said US consumers suffered “billions of dollars in injury” as a result of deception by Volkswagen (VW), which has admitted to using software that allowed 580,000 diesel vehicles built since 2009 to emit up to 40 times legally allowable pollution.

In January, the US Justice Department sued VW for up to $46 billion for violating environmental laws. VW also faces more than 500 civil lawsuits related to excess emissions, along with suits from some US states. Last week, a federal judge set a 21 April deadline for VW to come up with a concrete remedy for the vehicles.

This was one of the most egregious examples of a company deceiving the public. Hopefully, the court will provide adequate redress to consumers and send a strong message that this type of corporate behaviour won’t be tolerated.

Bill Nelson, US Senator & Florida Democrat

VW spokeswoman Jeannine Ginivan said the automaker has received the FTC complaint and “continues to cooperate” with all US regulators. “Our most important priority is to find a solution to the diesel emissions matter,” Ginivan said.

VW has an ongoing internal investigation to determine who at the automaker knew of the diesel cheating.

The FTC is seeking a court order requiring Volkswagen to compensate US consumers who bought polluting vehicles and an injunction to prevent future similar conduct by Volkswagen.

The FTC said VW’s claims “that the cars were low-emission, environmentally friendly, met emissions standards and would maintain a high resale value” were false.

VW remains in talks with the US Environmental Protection Agency, California Air Resources Board and Justice Department over terms of a settlement. US District Judge Charles Breyer and lawyers for the government and VW said last Thursday the sides had made “substantial progress” toward a settlement.

A settlement could include vehicle buybacks and cash incentives for repairs, along with environmental funds to address excess emissions. A point of contention is whether California and the EPA will accept a remedy addressing only part of the excess emissions.