U.S. FTC sues Volkswagen over diesel advertising claims

Tue Mar 29, 2016 12:05pm EDT
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By David Shepardson

WASHINGTON (Reuters) - The U.S. Federal Trade Commission on Tuesday sued Volkswagen Group of America, saying the U.S. 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 (VOWG_p.DE: Quote) unit in U.S. District Court in San Francisco. The agency said U.S. consumers suffered "billions of dollars in injury" as a result of deception by 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 U.S. 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 U.S. states. Last week, a federal judge set an April 21 deadline for VW to come up with a concrete remedy for the vehicles.

U.S. Senator Bill Nelson, a Florida Democrat, praised the FTC suit.

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

VW spokeswoman Jeannine Ginivan said the automaker has received the FTC complaint and "continues to cooperate" with all U.S. 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 U.S. consumers who bought polluting vehicles and an injunction to prevent future similar conduct by Volkswagen.   Continued...

Volkswagen VW cars are seen at a car dealer in Bochum, Germany March 16,2016.  REUTERS/Ina Fassbender