Volkswagen Canada must pay $2.1 billion — the largest commercial settlement in the country’s history — to affected Canadian customers as part of a class-action vehicle-emissions lawsuit that started in Windsor.
The eight-page decision handed down in Toronto Wednesday by Superior Court Justice Edward Belobaba directs Volkswagen to pay owners and lessees of 105,000 2-litre Volkswagen and Audi diesel vehicles between $5,100 and $8,000 each in damages.
As well, owners have the option of having Volkswagen fix the emissions problem or selling their used cars back to the company at what the vehicles were worth in 2015. Either way, the class-action members still collect the damages money.
Matt Quenneville, who works at a Windsor-area car dealership and who was the lead plaintiff in the class-action case, called the decision great news.
“It’s good that we have it over and done with and we can finally return the vehicles and move on,” the 34-year-old said Wednesday. “It has been a lengthy process.”
Quenneville first went to a lawyer in 2015 after the Volkswagen emissions scandal broke. On Sept. 18, 2015, the United States Environmental Protection Agency announced that its findings showed Volkswagen had intentionally programmed turbocharged direct injection engines to activate more emission controls during testing — but to emit up to 40 times more nitrous oxide in real-world driving.
Volkswagen later admitted to rigging 11 million vehicles worldwide, in model years between 2009 and 2015, including 500,000 in the U.S. — where last year the company agreed to pay about $10 billion in a class-action suit.
“I felt it was wrong that I was lied to so I contacted a law firm and asked if there was anything that could be done,” recalled Quenneville, who plans to sell his 2010 Volkswagen Golf wagon back to the company and buy a car from another company. “I expected to get good fuel mileage, for it to be clean, and for it not to hurt the environment.
“So I’m glad we were able to get what the judge considers a fair settlement, and were able to include everybody in the country.”
Maria Stenstroem, CEO of Volkswagen Group Canada, said in a statement: “Approval of the settlement is an important milestone in our journey to making things right in Canada. Volkswagen Group Canada is committed to ensuring that the settlement program is carried out as conveniently as possible for our affected Volkswagen and Audi 2.0L TDI customers. We are devoting significant resources and personnel to ensuring their experience with the settlement program is a positive one.”
Harvey Strosberg, the Windsor-based lead lawyer in the class-action suit along with London-based Charles Wright, called the case complicated but important.
“It’s a fantastic result,” said Strosberg, 72, who considers the case one of the greatest victories in his 46 years of practising law. “It’s a terrific result for the class members. And it’s the correct result because Volkswagen misconducted themselves awfully. Volkswagen cheated and lied.”
Windsor was at the forefront of the suit. Five of the nine named defendants hail from the Windsor area.
Strosberg said it took an excellent team of lawyers to prove what Volkswagen should pay in compensation.
“They were dead in the water on liability,” Strosberg said. “But the damage component was very difficult to argue.”
Canadian Volkswagen owners received a bonus that their U.S. counterparts did not. Affected Canadians have the right not to pay tax on what their trade-in Volkswagen is worth, only on the difference between that and the price of a new car. Strosberg estimated that if half the class members trade in their affected cars, the total tax savings will amount to about $65 million.
Meanwhile, Volkswagen’s problems have not ended. The German automaker is facing lawsuits around the world, having settled only in Canada and the U.S.
Martin Winterkorn, who was the Volkswagen CEO when some American professors decided to compare emissions tests with cars on the road and those in the garage, resigned shortly after the scandal erupted.
In Canada, the company will pay $15 million to the Canadian government. As well, since the whole $2.1-billion settlement will go to class-action members, arguments will now focus on what the lawyers — at least eight firms’ worth — will receive in compensation.
As well, Justice Belobaba is already presiding over a parallel class-action suit involving 3-litre Volkswagens, though that case will involve fewer than 10,000 cars.
“It was outrageous conduct on behalf of Volkswagen,” said Strosberg, who feels only a sustained effort produced such a big payout. “I’m very proud of the work our team did. It was a lot of work — and a lot of fun.”
Source: windsorstar.com
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