California Volkswagen and Audi Dealerships Lawsuit

California Volkswagen car dealerships have filed lawsuits against Volkswagen alleging they will suffer financial losses after Volkswagen admitted to using software—known as "defeat devices"—on certain diesel vehicles to pass US emissions tests. California Volkswagen car dealers filed their lawsuits claiming they will not receive compensation for millions of dollars of inventory they will not be able to sell. The lawsuits were filed in the wake of a Volkswagen recall of thousands of diesel Volkswagen vehicles.

The massive Volkswagen recall was announced September 18, 2015, after Volkswagen admitted to using special software to help its vehicles pass emissions tests. The software made it appear that the diesel vehicles gave off emissions within regulated limits, but those controls were off during regular driving situations allowing vehicles to emit up to 40 times the pollution allowed by the Clean Air Act.

Around 480,000 diesel Volkswagen Jetta, Beetle, Golf, Passat and Audi A3 cars in the US were affected by the recall. Globally, up to 11 million vehicles could be affected.

Owners of California Volkswagen dealerships have filed a lawsuit against Volkswagen, alleging they are unable to sell the affected vehicles knowing that they violate standards set by the EPA. According to Reuters (9/24/15), a letter sent from Volkswagen to US dealers offered reimbursement for expenses to franchise dealers, but not independent dealers. The same letter issued a "mandatory stop-sale order."

The lawsuit is Koudsi v. Volkswagen, case number 15-7477, in the US District Court for the Central District of California. Plaintiffs seek damages likely to exceed $1 million.

Volkswagen owners have also filed lawsuits against the carmaker, alleging they purchased the vehicles for their clean emissions and gas mileage but will be forced to sell the cars for significantly less than they paid. In addition to lawsuits, Volkswagen could face up to $18 billion in fines in the US for using the defeat devices.

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Published on Oct-27-15