German VW Dieselgate lawsuit delayed by paperwork

28 November 2019

Thousands of German drivers taking part in a class-action lawsuit against Volkswagen over the Dieselgate scandal may miss out on any form of compensation.

The Federal Office of Justice (FoJ) had been expecting around 33,750 claims from disgruntled drivers of VW cars affected by the emissions cheating debacle in 2015. However, it has been inundated with almost half-a-million claims, leading to a backlog of paperwork that could derail the case.

A significant delay could prove problematic to drivers, as any compensation offered is likely to relate to the residual value (RV) of their vehicles, which decreases with every mile driven.

Over the past few months, some 463,000 people have signed up to a collective lawsuit against VW, using a new legal instrument introduced in the aftermath of the diesel emissions saga, the Financial Times reports.

Increasing numbers

The Musterfeststellungsklage, or declaratory model action (DMA), which bears similarities to US class actions, was designed to prevent the courts from being clogged up by tens of thousands of individual claims, after Germany’s 100-plus regional courts complained of a deluge of Dieselgate cases

However, a large number of last-minute advertisements from law firms, which sought to convince signatories they would stand a better chance of a payout if they pursued individual actions, overshadowed the landmark DMA.

As a result, the FoJ was hit with 77,000 withdrawal requests in the final days before a September deadline for the collective case, including letters and faxes, which have to be sorted through by hand.

The agency has admitted that the task would be ′a great challenge’ and would not be finished before early next year.

No settlement

While judges are pushing VW to explore a settlement, with a deadline of 31 December set for a decision, lawyers for the carmaker say they cannot consider this until the FoI provides data on the number of claimants remaining.

′At present, even after more than a month-and-a-half, we do not even have a complete extract from the court register. It is completely unclear which of the applications are effective and how many people have unsubscribed,’ the carmaker told the newspaper.

While VW has admitted to wrongdoing over emissions testing in the US and has paid a $30 billion (€27.3 billion) fine, it has maintained that it has done nothing wrong in Europe. While drivers have had cars recalled to remove any software installed that was used in US testing, some have stated that the work has left their vehicles down on power, with depleted fuel consumption. VW is also facing class-action lawsuits in Italy and the UK.