WASHINGTON The U.S. Federal Trade Commission on
Tuesday sued Volkswagen Group of America, saying the U.S. arm of
the German automaker falsely advertised more than a half million
diesel vehicles as environmentally friendly when it knew they
were emitting excess pollution.
The FTC filed suit against the wholly owned Volkswagen AG
unit in U.S. District Court in San Francisco. The
agency said U.S. consumers suffered "billions of dollars in
injury" as a result of deception by VW, which has admitted to
using software that allowed 580,000 diesel vehicles built since
2009 to emit up to 40 times legally allowable pollution.
In January, the U.S. Justice Department sued VW for up to
$46 billion for violating environmental laws. VW also faces more
than 500 civil lawsuits related to excess emissions, along with
suits from some U.S. states. Last week, a federal judge set an
April 21 deadline for VW to come up with a concrete remedy for
U.S. Senator Bill Nelson, a Florida Democrat, praised the
"This was one of the most egregious examples of a company
deceiving the public," Nelson said. "Hopefully, the court will
provide adequate redress to consumers and send a strong message
that this type of corporate behavior won't be tolerated."
VW spokeswoman Jeannine Ginivan said the automaker has
received the FTC complaint and "continues to cooperate" with all
U.S. regulators. "Our most important priority is to find a
solution to the diesel emissions matter," Ginivan said.
VW has an ongoing internal investigation to determine who at
the automaker knew of the diesel cheating.
The FTC is seeking a court order requiring Volkswagen to
compensate U.S. consumers who bought polluting vehicles and an
injunction to prevent future similar conduct by Volkswagen.
The FTC said VW's claims "that the cars were low-emission,
environmentally friendly, met emissions standards and would
maintain a high resale value" were false. It said the vehicles
involved sold for an average price of approximately $28,000.
The FTC said VW promoted its "clean" cars through a
marketing campaign that cost tens of millions of dollars
including Super Bowl ads, online social media campaigns and
print advertising, "often targeting environmentally conscious"
VW remains in talks with the U.S. Environmental Protection
Agency, California Air Resources Board and Justice Department
over terms of a settlement. U.S. District Judge Charles Breyer
and lawyers for the government and VW said last Thursday the
sides had made "substantial progress" toward a settlement.
A settlement could include vehicle buybacks and cash
incentives for repairs, along with environmental funds to
address excess emissions. A point of contention is whether
California and the EPA will accept a remedy addressing only part
of the excess emissions.