Court: VW diesel rigging like horse-meat lasagna

Karin Matussek
Bloomberg News

The Volkwagen AG diesel-emissions scandal was compared to putting horse meat into lasagna by three German judges who ordered the company to reimburse a consumer for the full price of his car.

The manufacturer must take back a Skoda Yeti with a 2.0-liter TDI diesel engine and pay the buyer about 26,500 euros ($28,300), the court in the central German city of Hildesheim said in an emailed statement Tuesday. VW intentionally committed fraud and can’t defend itself by saying it hasn’t clarified who was responsible for software that allowed the vehicle to cheat on emissions tests, the court said.

The decision is the second this month from a German court that may give momentum to a host of suits seeking compensation for consumers. The judges’ statement used harsh language rarely found in court press releases, with underlined sentences like “illegal manipulation of engine control” and “illicit deviation of pertinent rules.”

“The use of engine software is a decision with enormous economic ramifications, so it’s hardly believable that it was taken by a low-ranking developer,” the court, about an hour’s drive from Volkswagen’s headquarters in Wolfsburg, said.

The judges also referred to another European consumer scandal, the use of antifreeze to sweeten wine in the 1980s. The horse-meat scandal dates back to 2013.

VW spokesman Nicolai Laude said the carmaker is sure the ruling will be overturned on appeal. The judges took a view that has been rejected by courts in other cities, including Cologne and Ellwangen, he said.

The company reached a $4.3 billion settlement with U.S. authorities in the diesel scandal last week. VW admitted to using false statements to import cars to the U.S. and obstructing investigations when authorities grew suspicious of the emissions levels from the diesel engines as part of the deal.

The judges in Hildesheim backed arguments another group of lawyers have put forward in a “sample suit” that is seeking payouts for thousands of VW customers. That complaint, filed in Braunschweig, relies on civil tort law, rather than contracts, to allow more drivers to sue VW. While it’s normally easier to make a case under contract laws, the Hildesheim court ruled that the tort-law argument relying on VW’s use of deception is valid.