On March 24, 2016, Judge Breyer held the fourth status conference for the consolidated multi-district litigation in San Francisco, California. The conference was very brief, lasting approximately ten minutes. The only topic discussed was the status of vehicle remediation.
As you may recall, at the last conference on February 22, 2016, Judge Breyer gave VW a thirty-day deadline to come up with a plan for how to get the polluting TDIs off of the road. VW was unable to meet this deadline. However, all of the parties (including the Plaintiffs, the Volkswagen Defendants, and the government) indicated to Judge Breyer that they had been meeting regularly to come up with a fix for the polluting cars and had made substantial progress.
Judge Gives VW 30 Days to Come Up with Something
On Thursday, February 25, Volkswagen once again told the court that although it continues to engage in discussions with the U.S. Environmental Protection Agency (EPA) about developing a fix for the diesel vehicles, there is still no agreement on what the fix will be.
MARCH 24, 2016 DEADLINE
Judge Charles Breyer, the presiding judge on the case, was not very pleased with the lack of progress in that area and ordered Volkswagen to report within the next 30 days on the status of a viable fix for the vehicles and a compensation plan. Judge Breyer was adamant that this situation needs to be addressed with urgency. He had real concerns over the situation that Volkswagen had created and was extremely upset that there are 600,000 cars on U.S. roads that are out of compliance with national standards and are over-polluting the environment. Judge Breyer was clear that he really did not care whether Volkswagen’s solution to fix the cars was the most economically advantageous solution for the company, only that it was done immediately and that it curtailed the emissions problem.
Can I Sell or Trade-in my Car Prior to Settlement?
We believe that, all things being equal, if an owner or lessee can wait to see what kind of settlement will be offered by Volkswagen, they should do so. But since each owner or lessee is in a different situation, if you need to sell or turn in your vehicle for financial or personal reasons, you can do so.
However, as a former owner or lessee you will likely be placed in a difference subclass of plaintiffs (i.e. those who have sold or returned their leased VWs), but the rough analysis should still hold true in a settlement - that you are entitled to be compensated for the loss of value to the vehicle.
Based on Hearing, a VW Fix Likely Within 3 Months
In a hearing held in federal court in San Francisco on January 20, 2016, the judge overseeing the civil litigation against Volkswagen, Judge Charles Breyer, again demonstrated his commitment to resolving the Volkswagen cases quickly and efficiently. Judge Breyer stressed the need for Volkswagen to act with urgency to resolve the case.
There’s at least half a million people with an immediate problem. This case needs immediate resolution of the issues. I’m not suggesting that other people aren’t affected. But the immediacy of the resolution seems to rest with the consumers.
— U.S. District Judge Charles Breyer
Volkswagen’s lawyers said that VW has had a team of engineers “working around the clock” to identify a fix to the emissions issue which would still have to be approved by the EPA. On January 12, 2016 the EPA agreed with a California Air Resources Board (CARB) rejection of VW’s initial plan for the “fix” which included a software change for all of the models, plus the addition of extra parts in some of the models.
Former FBI Director Robert S. Mueller Appointed as Settlement Master
On January 19, 2016, Judge Charles Breyer appointed Robert S. Mueller as a neutral settlement master to help settle the claims against Volkswagen. The Special Master will work with the lawyers from both sides to see if a mechanism for offering fair settlement offers can be setup. Mr. Mueller is a former FBI director and now a practicing attorney in Washington, D.C. Judge Breyer noted that Mr. Mueller possesses “consider experience and judgment to facilitate settlement discussion among the various parties in these complex matters.” This quick appointment of Mr. Mueller, further shows Judge Breyer’s commitment to try achieve expeditious settlement offers in this case. Mr. Mueller will work with Kenneth Feinberg, VW’s “independent” claims administrator to reach a settlement agreement in this case.
U.S. Dept. of Justice Files Complaint Against Volkswagen
On January 4, 2016, the United States Department of Justice, on behalf of the Environmental Protection Agency (EPA), filed a civil complaint in federal court in Detroit, Michigan, against Volkswagen AG, Audi AG, Volkswagen Group of America Inc., Volkswagen Group of America Chattanooga Operations LLC, Porsche AG and Porsche Cars North America Inc. (collectively referred to as Volkswagen). The lawsuit claims that Volkswagen's alleged misrepresentations allowed almost 600,000 diesel engines to emit excessive air pollution across the country, thus "harming our health and cheating consumers"
In its statement announcing the lawsuit, the EPA added that Volkswagen has not thus far produced a recall plan that is acceptable.
“So far, recall discussions with the company have not produced an acceptable way forward.”
The complaint is perhaps the first step in negotiating a settlement with the world's 2nd largest car manufacturer. Even though the DOJ did not file any criminal charges against any individual employees of the company, the civil filing does not preclude them from doing so in the future.
VW Class Action Lawsuits Transferred to California Court
On December 8, 2015, the Judicial Panel on Multi-District Litigation transferred all of the federally filed Volkswagen class action lawsuits to Judge Charles Breyer, who sits in the Northern District of California, in San Francisco. The Northern District of California, along with the District of New Jersey (Newark) and the Eastern District of Michigan (Detroit) were all contenders for the transfer. Based on our experience working on large-scale class actions like this one, we certainly were not surprised that a California court was selected, particularly given California’s interest, through heightened pollution standards, in this case.
Judge Breyer is a very well-respected judge whom we know very well. He is the brother of Justice Steven Breyer who sits on the Supreme Court. Judge Breyer is also the presiding judge in the lawsuits arising out of the Asiana Flight 214 crash at the San Francisco airport on July 6, 2013. We are the lead attorneys in that case and represent about 50 passengers who were on board the aircraft. We have been before Judge Breyer on numerous occasions, and as such Judge Breyer is very familiar with our law firm.
Update: VW Diesel Victims Receiving Goodwill Cards
Beginning the week of December 14th, 2015 clients are reporting that they have been receiving their VW Goodwill packages with the two different debit cards ready for activation. The turnaround time from application to receiving the package in the mail has so far been approximately four to five weeks.
One card is a $500 VISA debit card that can be used like a traditional debit card anywhere VISA debit cards are accepted - clothing, groceries, restaurants, whatever. The other card is a $500 "loyalty" card that can only be used at Volkswagen dealerships.
We have heard rumors about VW dealerships allegedly not honoring "loyalty" cards in respect to an imminent lease-end date or having sold the car prior to January 2016. We will try to get more information in regard to this issue.
As we have stated in previous posts, we see no legal reason for you not to take advantage of the Goodwill program. On November 16, 2015, U.S. District Judge Charles R. Breyer who is currently overseeing the multi district litigation (MDL) stipulated that plaintiffs who simply choose to participate in VW's goodwill program will not release or waive any rights to seek further compensation from Volkswagen in a civil lawsuit for damages related to the diesel scandal. Additionally, Volkswagen cannot use participation in the program in any manner to oppose "class-action" certification.
California Chosen as the Venue for Volkswagen Diesel Lawsuits
On December 8, 2015, the Judicial Panel on Multidistrict Litigation (MDL) consolidated 513 Volkswagen diesel lawsuits and chose California federal court as the most appropriate best venue. Kreindler & Kreindler has an office in Los Angeles, CA.
According to the panel, "relevant documents and witnesses may be found in both the Northern District and throughout California, given the role played by the California Air Resources Board in
uncovering VW’s use of defeat devices on its diesel engines."
U.S. District Judge Charles R. Breyer will oversee the litigation.
Volkswagen and Audi Goodwill Package
If you wish to participate in the Volkswagen or Audi Goodwill Package programs, you must register for those programs directly with Volkswagen through their website. Your participation with their program is up to you.
According to the website for the VW Goodwill Package and the website for the Audi Goodwill Package, the deadline for registration is April 30, 2016. Participation in either one of those programs will not affect your legal case against the company related to the emissions scandal.
On November 16, 2015 the Honorable Jose L. Linares, a United States District Judge for the District of New Jersey, granted the following court order that ensures that arbitration language included in the fine print of the VW Goodwill Package cannot impact your legal right to a jury trial.
a. VW will not contend that any right claim or interest of any Plaintiff or putative class member is waived, released, or impaired by participation in, or use of, any feature of the Goodwill Package, nor will participation in the Goodwill Package be used in any manner in opposition to class certification;
b. The Prepaid Visa Loyalty Card Cardholder Agreement and the Volkswagen Dealership Card Cardholder Agreement are solely between the customer and MetaBank® (and its successors, affiliates or assignees). Affected customers eligible for the Goodwill Package are not required to waive their rights or release their claims against VW in order to receive the Package. No terms of the Cardholders Agreements will waive any eligible customer's rights against VW with respect to their 2.0L TDI vehicles.
c. VW will not seek to enforce any arbitration clause or class action waiver or jury trial waiver provision contained in the Prepaid Visa Loyalty Card Cardholder Agreement and/or Volkswagen Dealership Card Cardholder Agreement made available to Plaintiffs or putative class members with the Goodwill Package, even if the Plaintiff or putative class member signs, executes or is otherwise deemed to have assented to any other part of the agreement, document or communication. Nothing in this Stipulation shall waive, release or impair any affirmative defenses otherwise available to Defendant.
“Affected customers eligible for the Goodwill Package are not required to waive their rights or release or arbitrate their claims against Volkswagen Group of America in order to receive the Package.”
As such, Volkswagen owners affected by the diesel scandal should not be concerned about using the Goodwill Package in relation to a separate civil action against the company.
However, we urge you to pay careful attention to any documents you are asked to sign. If for any reason it appears to you that Volkswagen or the dealership are trying to get you to release your claims, waive your right to participate in a class action or agree to arbitration, contact us immediately.
On January 11, 2016, Volkswagen announced that they are extending the Goodwill Package to "AFFECTED 3.0L TDI OWNERS AND LESSEES," although the letter only specifically says "Touareg TDI vehicle" and does not mention Porsche or Audi 3.0 TDI vehicles.
For more information regarding Volkswagen's Goodwill Program, visit their websites:
https://www.vwdieselinfo.com/goodwill_package/
Audi's Goodwill Program
https://www.audiusa.com/about/diesel-information/a3-diesel/goodwill-package-eligibility
