Volkswagen Scandal Sparks Worldwide Legal Action

Volkswagen Golf TDIThe Volkswagen emissions scandal has sparked a wave of litigation across the world. This includes the automotive giant’s home country of Germany, where the company could be facing criminal charges for its efforts to manipulate emissions tests.

The scandal broke when it emerged recently that the major vehicle manufacturer had fitted a number of its diesel vehicles with software designed to alter the results of the USA’s emission testing process. These “defeat devices” enabled the cars to effectively cheat on major emissions tests, providing readings that did not represent the actual emissions levels produced by the car in use. As a result, the vehicles were able to get through the tests even though their engines produced up to 40 times the legal limit of harmful emissions at other times.

The revelations caused the company’s shares to rapidly lose 30% of their value, and led the chief executive of Volkswagen, Martin Winterkorn, to step down. According to some news reports, funds equivalent to £4.3 billion have been set aside by VW in anticipation of the costs involved in dealing with the fallout of the scandal.

The revelation of the scandal has led to legal proceedings against the company in various jurisdictions. In the US, the country where Volkswagen has so far been shown to have fooled emissions tests, the country has asked international legal firm Kirkland & Ellis to handle expected litigation. In Germany, where the company is based, it is possible that criminal charges could be brought.

Major UK legal firm Slater and Gordon predicts that the company could also face legal action on British shores. A group claim could potentially be brought against Volkswagen by the many dealerships and individuals who purchased cars which have now severely fallen in value as a result of the scandal. A prominent specialist in shareholder fraud has predicted that a group claim by shareholders could also potentially be valid, having seen nearly a third of the value of their shares wiped out by the scandal.

Environmental law specialists ClientEarth have also weighed in on the matter, asking the Department for Transport to look into whether VW’s use of software to cheat on emissions tests may be part of a more widespread practice within the automotive sector.

ClientEarth chief executive James Thornton said: “The industry has shown it cannot be trusted. We cannot wait for action from the EU. First responsibility for protecting our health lies with our own government. The public must know the full scale of the problem and urgent action must be taken to fix it. Flouting laws cannot be tolerated.”

Read More