Volkswagen‘s US unit has agreed to settle – “in principle” – claims from dealers related to the diesel emissions testing rigging scandal but the automaker did not detail the amounts to be paid out or the total cost to the company.
“Volkswagen Group of America… has reached an agreement in principle to resolve the claims of VW-branded franchise dealers in the US relating to TDI vehicles affected by the diesel matter and other matters asserted concerning the value of the franchise,” VGA said in a statement. “Volkswagen has agreed to make cash payments and provide additional benefits to the dealers to resolve alleged past, current and future claims of losses in franchise value. Volkswagen and the dealers’ counsel will now work to finalise details of the proposed settlement, including how to apportion payments to dealers in the appropriate manner.”
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VW added details of the agreement in principle were still under discussion and expected to be finalised at the end of September.
“Any proposed agreement will become effective only after approval by the court, and the parties have agreed to keep further terms confidential as they work to finalise the agreement,” the statement added. VW said, under the agreement, it would consent to the certification, for settlement purposes only, of a class of VW-branded franchise dealers in the US as of an agreed date.
“We believe this agreement in principle with Volkswagen dealers is a very important step in our commitment to making things right for all our stakeholders in the US,” said Hinrich Woebcken, CEO of the North American Region, Volkswagen.
Steve Berman, managing partner of the dealers’ counsel, Hagens Berman, said: “Our clients recognised the best solution would be one that not only allows them to recoup lost franchise value and continue to employ thousands of American workers, but one that also charts a strong course for the recovery of the Volkswagen brand in the US. Now that there is a path forward for dealers, they can continue to work proactively to take great care of their customers, who are also VW customers.”
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By GlobalDataPlaintiffs filed the initial complaint against Volkswagen on 6 April, 2016, in the US district court for the Northern District of Illinois. The litigation was subsequently transferred to the multidistrict proceedings in the US district court for the Northern District of California.
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