U.S. judge approves $14.7 billion deal in VW diesel scandal
By David Shepardson
WASHINGTON (Reuters) - A U.S. judge on Tuesday approved one of the biggest corporate settlements on record, Volkswagen AG's (VOWG_p.DE: Quote) $14.7 billion deal arising from its diesel emissions cheating scandal, and the German automaker said it would begin buying back polluting cars in mid-November.
U.S. District Judge Charles Breyer in San Francisco signed off on VW's settlement with federal and California regulators and the owners of the 475,000 polluting diesel vehicles in a pivotal moment for the world's No. 2 automaker as it tries to move past a scandal that has engulfed it for more than a year.
VW admitted in September 2015 to installing secret software in its diesel cars to cheat exhaust emissions tests and make them appear cleaner in testing than they really were. In reality, the vehicles emitted up to 40 times the legally allowable pollution levels.
Volkswagen CEO Matthias Mueller told reporters in Berlin that Breyer's approval was "an important milestone for us on the way towards clearing up the problem that we caused some time ago." Hinrich Woebcken, president and CEO of Volkswagen Group of America, pledged to carry out the terms "as seamlessly as possible."
Breyer turned away objections from car owners who thought the settlement did not provide enough money, saying it "adequately and fairly compensates" them. Owners will get the pre-scandal "trade in" value of the vehicle and $5,100 to $10,000 in additional compensation.
"Given the risks of prolonged litigation, the immediate settlement of this matter is far preferable," Breyer wrote.
Volkswagen agreed to spend up to $10.033 billion on the buybacks and owner compensation and $4.7 billion on programs to offset excess emissions and boost clean-vehicle projects.
The settlement was reached with the U.S. Justice Department, Federal Trade Commission, the state of California and vehicle owners who had filed a class action lawsuit against VW. Volkswagen has admitted to misleading regulators and still faces an ongoing criminal investigation. Continued...