US states join forces to investigate VW; lawsuits abound

US states join forces to investigate VW; lawsuits abound

As expected, legal pressure on Volkswagen has continued to mount as government and private attorneys begin to investigate the diesel-emissions cheating scandal.

At least 27 US state attorneys general have joined forces to subpoena the company and proceed with a joint investigation, according to a Bloomberg report. Prosecutors will be considering charges related to violations of environmental regulations and consumer-protection laws.

The state-level investigations and potential prosecutions will parallel federal actions led by the US Justice Department. The egregious and apparently willful nature of the cheating could result in criminal prosecutions for individual executives or other workers.

The German automaker also faces numerous class-action lawsuits, filed in California and other jurisdictions. The litigation will focus on diminished value of affected vehicles, including the 2.0-liter TDI-powered Golf, Jetta, Beetle, Passat and Audi A3 from the 2009-2015 model years, along with potential performance or fuel-efficiency reductions if VW is forced to retune the engine-management software to meet government-mandated limits in real-world driving scenarios.

VW has already set aside 6.5 billion euros (~$7.25 billion USD) to help cover anticipated costs, however analysts suspect the fiasco could cost much more. The company reportedly faces federal fines of up to $18 billion, excluding additional costs associated with civil litigation and state-level actions.

The trouble could spread across the globe, as the same test-cheating software was installed in approximately 11 million vehicles worldwide.

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