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Volkswagen Agrees to $8.5 Million Settlement to End False Advertising Suit

On June 6, 2018, Oklahoma Attorney General Mike Hunter ("Hunter") announced an $8.5 million settlement has been reached with Volkswagen AG, Volkswagen Group of America Inc., Audi AG, and Audi of America LLC ("Volkswagen"). The payment will end the lawsuit Oklahoma brought against Volkswagen after an investigation revealed the company purposely installed deceptive software to its diesel vehicles in order to allow them to score better on emissions tests.

Hunter accused Volkswagen of falsely advertising its diesel cars as "environmentally friendly" and said the suit was necessary to protect Oklahoma consumers. He explained in a statement that Volkswagen "purposefully misled consumers in one of the most egregious cases of false advertising the automobile industry has ever seen. The company's fraudulent marketing practices deceived thousands of Oklahomans who believed they were buying a vehicle that was good for the environment. Our lawsuit was about holding the company accountable for these practices."

One of the named defendants in the Oklahoma suit is Volkswagen AG's former CEO, Martin Winterkorn ("Winterkorn"), who federal prosecutors recently charged with conspiring to defraud the U.S. government. In addition to Winterkorn, there are five former Volkswagen managers and executives who have been indicted, though they are all believed to be residing in Germany.

This settlement will not affect the terms of the previous deceptive software settlement between Volkswagen and the U.S. Department of Justice ("DOJ"), from which Oklahoma will receive an additional $21 million. The DOJ settlement also provides for a vehicle buyback and rewards of up to $10,000 for consumers who purchased the falsely-advertised diesel cars.

According to Hunter, Oklahoma will use the settlement money to provide education and programs dedicated to upholding consumer protection laws and helping citizens prevent and recuperate from consumer fraud. Some of the settlement will also go toward the cost of mediating consumer complaints and prosecuting companies that have deceptive marketing tactics.

A Volkswagen spokesperson commented that the settlement represents "another important step forward" for the company, and that "the agreement with Oklahoma fully resolves all claims asserted by the state related to the diesel matter."

The legal team at Shepherd, Finkelman, Miller & Shah, LLP ("SFMS") has significant experience litigating consumer fraud matters. If you have any questions regarding this subject or this posting, please contact Nick Lussier ([email protected]) or Chiharu Sekino ([email protected]). We can also be reached toll-free at (866) 540-5505.

SFMS is a law firm with offices in California, Connecticut, Florida, New Jersey, New York, and Pennsylvania. SFMS is an active member of Integrated Advisory Group (www.iaginternational.org), which provides us with the ability to provide our clients with access to excellent legal and accounting resources throughout the globe. For more information about our firm, please visit us at www.sfmslaw.com.

Sources

Vogt, RJ. "VW To Pay Oklahoma $8.5M Over Eco-Friendly Diesel Ads." Law 360. Last modified on June 6, 2018.

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