States Share $157M in VW Emissions Scandal

SAN FRANCISCO (CN) – In the latest fallout over its diesel-gate scandal, Volkswagen on Thursday agreed to pay $157 million to 10 states for installing emissions test-cheating software in some 570,000 vehicles nationwide.

The 10 states participating in the settlement are among 13 that adopted California’s tougher auto-emissions standards under a Clean Air Act waiver granted by the Obama administration in 2009.

Under terms of the deal, Volkswagen will pay $32.5 million to New York; $30.4 million to Pennsylvania; $28 million to Washington state; $20 million to Massachusetts; $16.2 million to Oregon; $14.8 million to Connecticut; $5.1 million to Maine; $4.2 million to Vermont; $4.1 million to Rhode Island; and $1.4 million to Delaware.

Volkswagen also agreed to introduce three new models of zero-emissions electric vehicles in each of the 10 states from 2020 to 2025.

“The agreement avoids further prolonged and costly litigation as Volkswagen continues to work to earn back the trust of its customers, regulators and the public,” Volksawgen said in a statement Thursday.

The $157.4 million deal comes in addition to previous agreements the German automaker struck to settle claims over its surreptitious installation of defeat devices in “clean diesel” vehicles deceptively marketed as environmentally friendly.

The defeat-device software kicks in when cars are being tested, making them emit less pollution than when on the road. With the device turned off, the cars spew up to 40 times more nitrogen oxide than allowed by U.S. standards.

The German automaker has paid more than $20 billion in U.S. civil settlements and criminal fines thus far for its use of emissions-cheating software in more than half a million vehicles sold in the United States.

“The companies are already paying billions of dollars in consumer relief, environmental mitigation funds, and criminal and civil penalties as a result of our earlier state, federal and private settlements,” New York State Attorney General Eric Schneiderman said in a statement. “Now, this state environmental penalty makes clear that no company – however large or powerful – is above the law in New York.”

Under two previous settlements totaling more than $16 billion, Volkswagen pledged to buy back or modify deceptively marketed 2.0 and 3.0-liter diesel engine vehicles and committed nearly $3 billion to environmental mitigation.

Earlier this month, the German automaker also pleaded guilty to federal charges of conspiracy and obstruction and agreed to pay $4.3 billion in civil and criminal penalties.

Six Volkswagen executives also face criminal charges in the scandal.

Volkswagen is also fighting a securities class action in federal court. Earlier this year, U.S. District Judge Charles Breyer refused to relinquish jurisdiction over that class action to a German court.

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