Published on March 25th, 2016 | by Steve Hanley
Volkswagen Went To Court This Week, Here’s What Happened
The saga of the Volkswagen diesel emissions cheating scandal has been going on since last September. The company has been sued by the federal government and faces fines that could total as much as $46 billion. The California Air Resources Board is also taking legal action against the company.
The federal suit is pending before US District Court judge Charles Breyer in San Francisco. He has appointed former FBI director Robert Mueller to act as Special Master to assist the parties in negotiating a settlement that is acceptable to both. At a hearing this week, Judge Breyer gave the parties a one-month extension to resolve their differences. That came after they advised the court that intensive negotiations have led to some progress. They also said issues remain and no settlement has been reached yet, according to a report in Automotive News.
“Volkswagen is committed to resolving the U.S. regulatory investigation into the diesel emissions matter as quickly as possible and to implementing a solution for affected vehicles, as we work to earn back the trust of our customers and dealers and the public,” VW said in a statement after the court hearing. “We continue to make progress and are cooperating fully with the efforts undertaken by Judge Breyer, working through Director Mueller, to bring about a prompt and fair resolution of the U.S. civil litigation.”
Judge Breyer cautioned the parties that if a settlement is not reached by April 21, he intends to let the case go to trial this summer. If that happens, your grandchildren will likely finish college before a final resolution takes place. Okay, that’s hyperbole. Substitute “high school” for “college.”
None of the litigants were willing to talk about the proposals on the table. There are basically two schools of thought on this topic. Some, like the Sierra Club, want to see heavy fines levied. That money would then be used to fund environmental cleanup programs. The Union of Concerned Scientists, weighed in this week, said, “Whatever we learn on Thursday, it is of the utmost importance that VW pay for its deception and remedy the damages of this corporate malfeasance. It is the role of the EPA and CARB to protect human health and the environment—a slap on the wrist and a nudge towards electrification is neither a suitable punishment nor remedy for the magnitude of this scandal.”
Like the Sierra Club, the Union of Concerned Scientists suggest money from fines levied against Volkswagen could be put to good use. It recommends a program to get old diesel-powered heavy trucks off the road. It notes, quite correctly, that heavy trucks create far more pollution than passenger cars. They also have a much longer useful life and can be spewing out their contaminants for decades. Getting the worst of them off the road would do far more for the environment than taking all those VW diesels and crushing them.
In a statement earlier this month, Todd Sax, chief of CARB’s enforcement division, said he did not believe a fix was available that would allow the cars to comply with the emissions standards or the onboard diagnostic requirements. “We will have to decide what the best approach is to dealing with these vehicles, and one of the options potentially would be to accept something less than a full fix,” he said. Environmental groups were disheartened by Sax’s comments, interpreting them as a sign that CARB is planning to go soft on Volkswagen.
They think CARB is leaning too far towards a suggestion advanced by Elon Musk and a number of business leaders. It calls for the EPA to force Volkswagen to make more electric cars. The company has said recently it has plans in place to expand the manufacture of plug-in cars at its assembly plant in Chattanooga, Tennessee. It also is working diligently at expanding the charging infrastructure for plug-in hybrid and fully electric cars. The Union of Concerned Scientists takes the position that letting Volkswagen use the money that should go into fines and penalties to promote its own business is wrong headed.
The issues raised by Volkswagen’s blatant cheating are complex. When courts and lawyers get involved, things often get even murkier. Will this be resolved by April 21? A prudent person would probably bet against that scenario.