VW’s Not So “CleanDiesel” Gets Sued

The widening scandal over Volkswagen’s not-so-clean “CleanDiesel” cars came to San Francisco federal court Monday with the filing of a broad class action by car owners in 23 states who accuse the company of fraud.

The U.S. Environmental Protection Agency accused the company of placing sophisticated software in its diesel cars to deliberately mislead pollution tests. The German automaker admitted there were problems in nearly 500,000 U.S. vehicles sold as “CleanDiesel.”

On Tuesday Volkswagen issued a statement that cars outside the U.S. have a similar problem, potentially affecting 11 million diesel cars that may have been geared to cheat pollution checks.

In a class action complaint filed in San Francisco Monday, consumers alleged VW engaged “in a secret scheme to evade federal and state vehicle emissions standards” for nitrogen oxide, which contributes to ozone and smog creation.

The software was designed to kick-in during emissions testing and show far lower emissions than when actually operating on the road.

Some of the false readings resulted in autos with emissions 40 times applicable standards, the suit states.

The suit alleges breach of contract, violation of various state consumer protection laws, fraudulent concealment and California’s unfair competition law.

VW said it would set aside 6.5 billion euros, or about $7.3 billion, equal to a year’s profits, to cover the cost of fixing the cars and begin complying with pollution standards.

The case was assigned to Magistrate Judge Donna Ryu, but may be reassigned to an Article III judge on either parties’ request.

Case: Benipayo v. Volkswagen, No. 15-cv-4314


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