Former VW CEO Winterkorn to Pay Millions in Damages for Dieselgate

The Volkswagen Dieselgate emissions scandal is finally seeing some light in the lawsuit against those responsible for the deceitful act. Several of the company’s former bosses will be shelling out a total of €288M as compensation to the German car maker. One of them is Martin Winterkorn.

Winterkorn, who was VW’s CEO when the scandal broke, initially denied the allegations saying he was not aware of the defeat devices. He, along with other executives, blamed a group of rogue engineers for the diesel emission scandal. He resigned from his position on 23 September 2015, one week after the cheat device was discovered. He was eventually charged for several conspiracies, including committing wire fraud, violating the Clean Air Act, and defrauding the United States. He was also accused of committing three acts of wire fraud.

Prior to his resignation, Winterkorn apologised to VW’s customers and the public but stood firm against calls for him to step down from his post. However, according to board member and Lower Saxony economy minister Olaf Lies, the culprits of the scandal acted criminally and must be held accountable.

Although a German court dropped the charges for market manipulation against Winterkorn, the fraud allegations still stand. The former CEO’s legal counsels insist his innocence on the fraud charges.

The Volkswagen Group claims the board did not know about the issues until shortly before the news spread on social media. Mr. Lies reiterated, however, that VW should have been informed about it when the scandal was publicized in the US for more than a year before they learned of the issue.

Dieselgate happened when Volkswagen faked diesel emissions tests for Jetta, Passat, Golf, and Beetle cars built between 2009 and 2014. The United States’ Environmental Protection Agency (EPA) charged the automaker with breaching the Clean Air Act by installing the device to tamper with test findings. The software could read the vehicle’s activities and automatically reduce the NOx emissions of the vehicles in order to pass the test. In actuality, normal emissions levels of the VW cars are 40 times higher than the regulated levels.

A VW representative informally admitted to EPA Office of Transportation and Air Quality Director, Christopher Grundler, during a conference on green transportation in August 2015 that the allegations were true. The EPA then threatened the carmaker that approval of the 2016 VW and Audi diesel models would be rejected if Volkswagen did not formally admit their faults. The admission was made by US and Germany VW executives during a September 3 conference call with the EPA and California officials.

Winterkorn indictments

When the scandal broke out, Martin Winterkorn was also the chairman of Audi, but he left the company in November 2015. After being criminally indicted in the City of Braunschweig in Germany on 15 April 2019, Winterkorn was indicted for the charges in the US.

During a 2015 business conference held in Germany, Winterkorn was informed about the cheat device and agreed to keep US regulators in the dark about the software by concealing any proof of it. He is considered a fugitive in the United States.

Winterkorn’s share in the compensation for VW is €10M.

Who else is paying VW?

Audi has admitted to installing the cheat device in 11 million of its diesel cars across the globe, which is why VW will also receive damages from former Audi CEO Rupert Stadler, who was put on suspension by the company after he was arrested in June 2015. He was terminated in 2018, following an investigation into allegations that he was an accomplice in the scheme.

Aside from being a Dieselgate suspect, Stadler was also accused of tampering with evidence by suggesting that a witness be told to go on leave. He is set to pay VW €4.1M.

A total of €270 million will come from Directors’ and Officers’ insurance (D&O insurance), which is designed to shield executives from personal liability and may also be used to compensate a firm for legal fees and other expenses.

This will help VW recover some of the money they lost when they paid vehicle owners who were affected by the cheat device. Expert solicitors such as the ones at emissions.co.uk helped these customers settle their claims.

Claiming for your Dieselgate car

If you think that your VW or Audi is affected by the emissions scandal, you can seek compensation for damages and the effects that the high levels of NOx emissions have on you and your loved ones’ health.

The Volkswagen Group is not the only car manufacturer that is potentially involved in the Dieselgate case. Other alleged affected brands, all manufactured between 2008 and 2018, are as follows: