Volkswagen's $14.7 Billion Emission-Cheating Settlement Approved By Judge In SF

BAY AREA, CA – A $14.7 billion settlement between Volkswagen and the owners of 475,000 vehicles and several government agencies to resolve a pollution-cheating scandal was approved by a federal judge in San Francisco today.

U.S. District Judge Charles Breyer said the settlement is "fair, reasonable and adequate" -- the legal standard for approval of a class action settlement.

The German automaker agreed to spend $10 billion to compensate people who bought or leased Volkswagens or Audis with 2-liter engines in the U.S.

The drivers will have a choice of accepting a buyback of their car or receiving an emissions fix for it. Most will also receive additional compensation of $5,000 to $10,000.

Under settlements with the U.S. Environmental Protection Agency and the California Air Resources Board, Volkswagen will also pay $2.7 billion to compensate for environmental damage and $2 billion to develop
non-polluting emissions technology.

Breyer wrote that at the outset of the cases last year, he had said the top priority was to get the polluting cars off the road as soon as possible.

"The settlement does that," he wrote.

Hinrich Woebcken, the president of Volkswagen Group of America Inc., said, "Volkswagen is committed to ensuring that the program is now carried out as seamlessly as possible for our affected customers."

Elizabeth Cabraser, the lead attorney for individuals and groups of car owners who filed more than 1,000 lawsuits, said, "We are very pleased the court has granted final approval to this historical settlement that holds Volkswagen accountable for its illegal behavior and breach of consumer trust."

The cars were equipped with so-called "defeat devices" that would turn on full pollution controls when the cars were being tested, but would turn off the controls when cars were driven normally. The vehicles sent up to 40 times the allowed amount of nitrogen oxides into the area.

A settlement has not yet been reached for a smaller number of vehicles with 3-liter engines. The liter number refers to cylinder space in an engine.

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