Germans are getting class-action lawsuits—just in time to sue Volkswagen

Time for VW to cough up at home?
Time for VW to cough up at home?
Image: Reuters/Dado Ruvic
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More than three years after Volkswagen’s emissions cheating scandal broke, consumers in the car maker’s home country could finally get a shot at suing the all-powerful company.

To do so would require something akin to class-action suits, where a group of plaintiffs band together under the representation of one individual or law firm. Unlike the US, where they are common, such lawsuits are not allowed under German law. That will change next week when the government approves class-action lawsuits.

Chancellor Angela Merkel’s conservatives had been dragging their feet on the change, and have been criticized for what is regarded as an attempt to protect the all-powerful German car industry at the expense of people’s health and wallets. Talk of making the German taxpayer foot part of the bill to fix diesel engines has been met with outrage. Meanwhile, plunging diesel sales and a court decision to allow diesel bans in some German cities has the government worried about an industry that employs around 800,000 people.

While VW compensated around 400,000 US customers at a cost of over $7 billion, in Germany—where it argues it hasn’t broken any laws—it has only been asked to upgrade the emissions-manipulating software on  2.8 million diesels. In the US, drivers are entitled to a total engine overhaul, not just the much cheaper software fix. A Handelsblatt report notes that out of the $31 billion the carmaker has earmarked in fines and compensation, the bulk of it has been paid out in the US.

“We will achieve the goal we have set in the coalition agreement,” John Fechner, a spokesman for the parliamentary group of Merkel’s coalition partners, the center-left Social Democrats, told the Tagesspiegel (link in German), adding that the new law allowing class-action suits will come into force on Nov.1.

People hoping to make Volkswagen pay up for selling them dodgy diesels will need to be quick, though—the statute of limitations for claims against VW will run out at the end of this year.

“Time is short,” justice minister Katarina Barley told RedaktionsNetzwerk (link in German). “We must ensure the victims of the VW diesel scandal don’t lose their claims due to the statute of limitations.”