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Tuesday, 5 January 2016

Volkswagen Faces Billions of Dollars in Penalties From U.S. Suit


The U.S. Justice Department sued Volkswagen AG for installing illegal devices meant to defeat emissions testing, and laid out claims that could push penalties into the tens of billions of dollars -- an opening salvo in a legal battle that could be far more costly for the German carmaker than had been expected.


The civil complaint filed Monday accuses the automaker of four violations of the Clean Air Act and outlines penalties that could amount to as much as $80 billion -- about four times as much as the maximum some legal experts had estimated. While the court is unlikely to come anywhere near that amount, according to a senior Justice Department official, the penalties sought against the company would still be in the billions of dollars, another senior Justice Department official said.

Volkswagen already faces hundreds of private lawsuits in the U.S. for its actions, which have been consolidated in San Francisco federal court. The Justice Department said it will ask for its suit to be transferred to that court as well, borrowing a tactic from its case against BP Plc in the Gulf oil spill litigation, where it worked alongside plaintiff’s lawyers.

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