Sorrell announces Volkswagen settlement

MONTPELIER — Vermonters who purchased or leased certain Volkswagen and Audi 2.0-liter diesel vehicles are set to receive a cash payment of more than $5,000 from Volkswagen and have the option of having their vehicle modified or bought back by Volkswagen under the terms of a settlement agreement with the company, Vermont Attorney General William Sorrell said.

The agreement is a partial resolution of a consumer class-action suit and a lawsuit filed by the federal government against Volkswagen in California. The company has admitted to federal officials that it installed software in cars that would intentionally provide false information to technicians during emissions tests. The software was installed in up to 11 million vehicles worldwide.2000px-Volkswagen_logo.svg

The settlement announced Tuesday, upon judicial review, will provide about 3,000 owners of 2.0-liter diesel vehicles in Vermont with a restitution payment of at least $5,100 and the choice of having Volkswagen buy back their vehicle or modification of their vehicle that will reduce emissions, as the company originally promised to do. Consumers who leased their vehicles will receive a no-penalty lease termination option and cash payment.

Volkswagen is expected to spend more than $15 billion to settle claims across the country, with about $10 billion going to vehicle buy backs and restitution payments.

The buy back price will be based on the vehicles’ National Automobile Dealers Association value before news of the scandal broke. If an acceptable modification of the vehicle is not approved, Volkswagen will buy back vehicles, according to Sorrell.

“Volkswagen is being held accountable for its total disregard for our consumers and the environment,” Sorrell said in a statement. “Today’s agreement is a big step towards making Vermonters whole, but there is still much work to be done. My office will continue to pursue this matter so that Volkswagen is also held responsible for the environmental harm it has caused, as well as to deter future acts of orchestrated consumer deception.”

Sorrell said the agreement also includes the creation of an Environmental Mitigation Fund. Volkswagen must pay $2.7 billion in to a trust to support environmental programs across the country to reduce nitrogen oxide emissions. Under the terms of the mitigation trust, Vermont is eligible to receive $17.8 million. Sorrell said state officials are in the process of determining whether and how it will be able to utilize the funds.

Several states have also reached a settlement with Volkswagen requiring payment to those states for violating laws against unfair or deceptive acts and practices. Sorrell said Vermont has 30 days to decide whether to accept a settlement on the same terms or to pursue its own action against Volkswagen for violations of Vermont’s Consumer Protection Act.

The partial settlement announced Tuesday preserves claims by Vermont under state environmental laws, according to Sorrell. He said the state intends to seek additional penalties from Volkswagen for its violations of environmental laws and regulations.

Full terms of the settlement can be found here:

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