N.J. joins other states in suing Volkswagen for emissions fraud

The state of New Jersey has joined three others in suing Volkswagen over the Dieselgate scandal. N.J. is not only seeking penalties for emissions violations and consumer fraud, but it is also seeking restitution for consumers.

New Jersey has joined three other states actively pursuing Volkswagen in court over the Dieselgate emissions standard. Reuters said yesterday that the state claims VW has committed massive consumer fraud and has violated clean air laws. The state thus joins Texas, New Mexico and West Virginia in suing Europe’s biggest automaker.

In its filing, New Jersey said that for the “past decade Volkswagen engaged in one of the largest consumer frauds” in car industry’s 130-year history. “It developed and distributed into the marketplace sophisticated software to evade emissions requirements; it misled regulators about the true environmental impacts of its vehicles, and it misled consumers about the products that it was marketing as supposedly good for the environment.”

John Hoffman, New Jersey’s acting attorney general, is leading the effort. Specifically, New Jersey is not only seeking civil penalties for violations of state emissions and consumer protection laws, but it is also seeking restitution for consumers.

Volkswagen said that the company’s priority is finding an “approved remedy for affected diesel vehicles. We continue to cooperate fully” to achieve the goal. VW is working with the Environmental Protection Agency (EPA) and the California Air Resources Board (CARB) to find an acceptable fix for the problem.

The automaker is not only facing active suits by the quartet of states, but it is also facing a lawsuit by Harris County, Texas. And, the Justice Department has filed a civil racketeering lawsuit seeking up to $46 billion from the automaker for violating clean air laws.

Also, VW is facing more than 500 civil lawsuits. The lawsuits have been consolidated before a federal judge in California. The court has retained a former FBI director to act as a settlement advisor. Meantime, the automaker is also facing investigations by 48 state attorneys general. And, it is facing criminal probes in Germany, France, Italy, South Korea and India.

Last week, Volkswagen filed a repair and recall plan for 80,000 3.0-liter V-6 diesel SUVs and luxury vehicles. Its plan to repair more than 480,000 2.0-liter diesel cars has been rejected by both EPA and CARB. California termed the VW 2.0-liter filing insufficient and not timely.

In a bit of good news, though, its plan to fix up to 8.5 million vehicles in Europe was approved, and the automaker is scheduling repairs.

The Dieselgate emissions scandal began in September when Volkswagen admitted it had installed emission testing cheatware in 488,000 diesel cars in the United States. The automaker was cited for its violation at that time, and the EPA ordered the recall of the vehicles. Shortly after this action, VW admitted it had installed the software in up to 11 million vehicles worldwide. And, a bit later, Audi said that the software was also used on its 3.0-liter diesel V-6 engine.

So far, the scandal has been costly. The automaker has set aside more than $6.7 billion for current costs, and it is expected that by the time the issue is settled, it may cost more than $25 billion, discounting possible damages obtained in the lawsuits. Dieselgate has also cost the former chief executive of VW, Martin Winterkorn, his job. And other major executives have either been suspended or have resigned. An internal investigation by VW is ongoing. Also, the automaker’s value has shrunk sharply and its sales, which had been healthy for several years, have also fallen away.