Volkswagen may pay more than $100M to settle lawsuit against "clean diesel" engine claims in Kentucky

06/28/2016 04:49 PM

FRANKFORT — Kentucky may get more than $100 million in a settlement with German automaker Volkswagen for misrepresenting its “clean diesel” engines.

Some 3,200 who bought Turbocharged Direct Injection diesel-engine vehicles from Volkswagen, including Audis and Porsches, will be eligible for either a buyback of the vehicle or engine upgrades to improve emissions, Attorney General Andy Beshear announced at a Capitol press conference on Tuesday.

That provision can cost Volkswagen up to $80 million, and TDI vehicle buyers can also receive at least $5,100 in restitution from the company, which may cost up to $16.3 million, Beshear said.

Tuesday’s announcement follows a settlement between Volkswagen and federal authorities worth up to $14.7 billion after the company admitted to installing software on 11 million vehicles to cheat emissions tests, according to The New York Times, which reported that the vehicles were found to emit nitrogen oxide at levels 40 times greater than allowable under the Clean Air Act.

Beshear, whose office filed the suit against Volkswagen in Franklin Circuit Court in March, called the settlement “one of the best settlements that this commonwealth has seen in a long time by a company alleged to have violated our Consumer Protection Act.”

“The buyback, if those 3,200 chose to sell their cars back and had paid them off, could reach or exceed $80 million,” Beshear said. “The $5,100, which is the minimum restitution payment that people will receive, if all 3,200 Kentuckians take advantage of it, will exceed $16.3 million.”

The settlement, set for approval in October, also includes $3.5 million in civil penalties and $19 million to establish an Environmental Mitigation Trust.

Beshear said he expects the state’s General Fund will receive $2 million of those penalties and that his office is “very excited” with the mitigation fund, which will help combat nitrogen oxide emissions, the same type that Volkswagen’s so-called clean-diesel engines were supposed to reduce.

“We think that that is of incredible value and can support some very important projects that will improve the overall health of Kentuckians into the future,” he said.


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