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Engineer Headed to the Big House

Former Volkswagen Diesel Engineer Headed to the Big House After Judge Makes an Example of Him

Aug 25, 2017




A former Volkswagen engineer who helped federal investigators after being linked to the diesel emissions scandal will cool his heels in an American prison.

U.S. District Court Judge Sean Cox sentenced James Liang, 63, to a 40-month term today, tacking on a $200,000 fine for his involvement in the automaker’s diesel deception. Liang is the first Volkswagen employee prosecuted for having a role in the conspiracy.

Despite his assistance in the hunt for co-conspirators, it was clear authorities weren’t going to let Liang off the hook.

The engineer has deep roots at the automaker, having joined the Volkswagen team in 1983. Before leaving Germany for the company’s U.S. division in 2008, Liang assisted in developing the defeat device-equipped engines earmarked for North American distribution. The 2.0 and 3.0-liter turbodiesel engines, fitted in roughly half a million U.S. vehicles sold between 2009 and 2015, spewed tailpipe emissions up to 40 times the legal limit.

Until 2015, U.S. environmental regulators were none the wiser. VW engineers ensured the onboard emissions control devices worked only when the cars were undergoing emissions compliance tests.

Liang pleaded guilty in a U.S. District Court last September after being charged in June 2016.

Judge Cox, who called the conspiracy a “serious crime” and a “stunning fraud on the American consumer,” didn’t go easy on the engineer. Prosecutors had recommended a three-year prison term and $20,000 fine, while Liang’s lawyers sought home detention and community service. Liang ended up with more jail time and a much, much larger fine.

Cox made note of Liang’s comfortable pre-scandal lifestyle, which involved a swanky California home and quarter-million-dollar salary, as he handed down the sentence. Liang, he said, “didn’t want to walk away from this lifestyle, which would have been the right thing to do.”

While Liang’s lawyer characterized his client as a victim of “misguided loyalty” who wasn’t the “mastermind” behind the operation, the federal prosecutor disagreed. Liang’s engineering prowess was “pivotal” in concealing the defeat devices, Mark Chutkow argued. He added that prison time sends a strong message to the industry.

While indictments exist against several German nationals, there’s only one other VW employee facing possible jail time in the U.S. at this moment. Oliver Schmidt, VW’s former U.S. emissions compliance boss, pleaded guilty to conspiracy earlier this month. Authorities nabbed Schmidt at a Florida airport earlier this year as the German national made a stopover on his way home from a tropical vacation.


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Discussion Starter #82
Former VW Exec Gets 7 Years

Former VW Exec Gets 7 Years in Prison for Role in Dieselgate Scandal

Dec 07, 2017



Former Volkswagen executive Oliver Schmidt, who authorities say played a significant role in trying to cover up the automaker’s ‘Dieselgate’ scandal, has been sentenced to 7 years in prison and must pay a $400,000 fine.

The sentencing represents the maximum allowable punishment for the 48-year old Schmidt, who was arrested in January of this year when trying to return to Germany following a family vacation on Florida. He will be allowed to serve the remainder of his sentence in the Milan, Michigan facility where he has been held since March. Schmidt will also be granted time served for the 11 months he has already spent behind bars.

Authorities say Schmidt led VW’s initiative to conceal its diesel emissions scandal and did not cooperate with US investigators during their probe into the matter. He plead guilty to two felony charges of conspiracy to defraud the United States and violating the Clean Air Act. According to Automotive News Europe, a third charge of aiding and abetting wire fraud was rolled into the conspiracy charge as part of a plea agreement.


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Former VW CEO Indicted

Former VW CEO Indicted in Federal Court

May 03, 2018




Martin Winterkorn, Volkswagen’s former CEO, was charged in federal court in a superseding indictment unsealed in Detroit today.

The former CEO is being charged with conspiracy, wire fraud, and violation of the Clean Air Act, all of which are in relation to the Dieselgate scandal that rocked the automaker in 2015.

The ninth person to be charged in relation to emission scandal, Winterkorn was CEO at VW from 2007 to September 2015, when the scandal broke.

Winterkorn is accused of specifically approving efforts to mislead government regulators in the indictment.


The indictments were filed in March and unsealed today because there is no longer a belief that it will compromise an ongoing investigation, according to US Attorney Matthew Schneider, who spoke to Automotive News.


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VW Slapped with Billion Euro Dieselgate Fine

VW Slapped with Billion Euro Dieselgate Fine

Jun 14, 2018



Volkswagen will have to pay one of the biggest ever fines imposed by German authorities against a company. The one billion euro fine is the latest punishment the company faces for its 2015 Dieselgate scandal.

“Following thorough examination, Volkswagen AG accepted the fine and it will not lodge an appeal against it,” said VW in a statement. “Volkswagen AG, by doing so, admits its responsibility for the diesel crisis and considers this as a further major step toward the latter being overcome.”

Volkswagen will update investors on the implications of the fine on August 1, when it releases the result of its second quarter, according to Frank Witter, the automaker’s finance chief.

While the fine is undoubtedly serious, VW’s recent performance and scale mean that “in the broader context it isn’t a material number,” Arndt Ellinghorst, Evercore ISI analyst, told Reuters. That’s because the company came out of the first quarter of 2018 with a 24.3 billion euro net cash position in Europe.

The fine is the latest result of VW’s diesel woes and ends regulatory offense proceedings against it. That’s good news for VW, but this is by no means the end of the road for Dieselgate. According to the prosecutor’s office, the fine doesn’t address any civil claims or claims by vehicle owners.



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Audi CEO Arrested in Dieselgate Investigation

Audi CEO Arrested in Dieselgate Investigation

Jun 18, 2018



Rupert Stadler, Audi’s embattled CEO, was arrested Monday “as part of an investigation into diesel affairs and Audi engines,” according to a release from the Munich prosecutor’s office.

Stadler has not been found guilty of a crime yet so the presumption of innocence remains, but he is seen to be at risk of suppressing evidence, so a German judge ordered that he be remanded into custody.

The arrest follows a statement from German prosecutors last Monday, saying it would widen its investigation to include Stadler, among others.

Prosecutor’s made the arrest at Stadler’s home early on Monday morning.


Stadler has been at the helm of Audi since well before the emissions scandal broke and has been criticized in the past for his handling of the scandal. Still, the Audi board had enough faith in him to give him another five year contract as CEO, while the Volkswagen board saw fit to put him in charge of Group Sales.

Audi has yet to release a statement about the arrest, but a Porsche SE (the company that controls the VW group) spokesperson said that the issue would be discussed at a board meeting today.

Prosecutors said that this arrest was part of its own investigation and that it was not made at the behest of US authorities.


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Dieselgate Forces Volkswagen to Highlight Rivals’ Products

Dieselgate Forces Volkswagen to Highlight Rivals’ Products

Aug 14, 2018




As part of its penance for pumping untold amounts of smog-causing pollutants into America’s air over the span of roughly six years, Volkswagen paid a steep price. Yes, there was the financial cost of the diesel scandal — a price tag topping $20 billion, covering fines, buybacks, repairs, etc. Then there was the shame, with VW execs issuing public apologies so frequently, you’d think they were congressmen.

As fines and public apologies aren’t that uncommon in the automotive sphere, it’s the third act that must really grind the gears of execs in Wolfsburg. The automaker now has to do something no self-respecting car company would ever do: It has to showcase another company’s products, and not in a bad light.

Electrify America, a VW subsidiary created in 2016 as part of the automaker’s environmental remediation efforts, has an ad out. You remember Electrify America — it’s the initiative the U.S. government forced VW to spend $2 billion on over the course of 10 years. Its aim: to promote zero-emission vehicles, educate the public, and build recharging infrastructure.



One key part of VW’s agreement is that its messages must be brand neutral. Otherwise, it could just showcase the e-Golf and boast about its upcoming I.D. line of electric vehicles. Nope, that won’t fly with the feds.

And so, in Electrify America’s new ad, we see no Volkswagens, at least not at first. And not specifically. Instead, we see products from other automakers. Essentially, it’s an ad touting the virtues of the Chevrolet Bolt while slamming — quite amusingly — Subaru, which fields no electric vehicles.

It opens with an orange Subaru Outback chugging through an arid landscape, smug flannel-and-vest-clothed driver behind the wheel, “Planet Hugger” sticker clinging valiantly to the rear bumper. The theme from The Flintstones reaches our ears. At a stoplight, an orange Bolt pulls alongside, the man’s alter ego behind the wheel. From our speakers comes the unmistakable theme song from The Jetsons, implying this driver, and his car, is highly evolved. The two men exchange glances. Now, it’s the Bolt driver’s turn to look smug.

As the light goes green, the Outback driver looks on, discouraged, as the Bolt rockets away from the stop with barely a whisper. Cut the theme music, and cue the buy-an-EV message. The Bolt then drives past a woman charging her Hyundai Ioniq EV, though, unlike the Bolt, we can’t see the logo on the front of the car. It ends with a group of EVs, filmed from the rear, racing down a darkened highway, presumably towards a glorious, green future. In that group we see the Bolt, a Honda Clarity, Nissan Leaf, BMW i3, and yes, an e-Golf.

When you’ve got the feds standing over you, holding a whip, normal automaker rivalry becomes a thing of the past.


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Discussion Starter #87
FCA US Reaches Settlements on Emissions Requirements

FCA US Reaches Settlements on Emissions Requirements

FCA has reached final settlements on civil, environmental and consumer claims with U.S. federal and state agencies as well as private class actions to resolve differences over diesel emissions requirements
Estimated total cost of settlements is $0.8 billion, in line with financial charge taken for this purpose in third-quarter, 2018
FCA will provide free software update for an estimated 100,000 vehicles; service provided through an emissions recall and does not require any hardware modification
Settlements include an average of $2,800 in compensation for each eligible customer affected by the recall
Civil penalties under the settlement total approximately $400 million, payable to various U.S. federal and state authorities
FCA maintains its position that the Company did not engage in any deliberate scheme to install defeat devices to cheat emissions tests
The consent decree and settlement agreements contain no finding or admission with regard to any alleged violations

January 10, 2019 , London -

Fiat Chrysler Automobiles N.V. (NYSE: FCAU / MTA: FCA) announced today that its wholly owned subsidiary FCA US LLC has reached final settlements on civil, environmental and consumer claims with the U.S. Environmental Protection Agency (EPA), U.S. Department of Justice (DOJ), the California Air Resources Board (CARB), the State of California, 49 other States and U.S. Customs and Border Protection, agreeing to pay approximately $400 million in civil penalties to resolve differences over diesel emissions requirements.

FCA US has also settled a putative class action on behalf of private consumers.


Customer compensation, the estimated future cost of the extended warranty and the cost of environmental mitigation efforts also account for approximately $400 million. The resulting $0.8 billion total is in line with the financial charge taken by the Company for this purpose in third-quarter, 2018.

The settlements do not change the Company’s position that it did not engage in any deliberate scheme to install defeat devices to cheat emissions tests. Further, the consent decree and settlement agreements contain no finding or admission with regard to any alleged violations of vehicle emissions rules.

“We acknowledge that this has created uncertainty for our customers, and we believe this resolution will maintain their trust in us,” said Mark Chernoby, the Company’s Head of North American Safety and Regulatory Compliance.

FCA US will conduct an emissions recall to update emission control software in an estimated 100,000 model-year 2014-2016 Ram 1500 pickups and Jeep Grand Cherokee SUVs equipped with 3.0-liter EcoDiesel V-6 engines. The software reflash does not affect average fuel economy, drivability, durability or refinement of the vehicles.

Each current and former owner and lessee of these vehicles will be eligible to receive a payment averaging $2,800 as part of the plaintiff steering committee settlement. The affected vehicles will also qualify for an extended warranty in connection with the software update.

“We have implemented rigorous new validation procedures and updated our training programs to ensure continued compliance with the increasingly complex regulatory environment,” Chernoby said. “Such measures are consistent with our mission to deliver advanced technologies that deliver value to our customers and that enhance the environmental performance of our products.”

The settlements are now lodged with the San Francisco division of the United States District Court, North District of California, where they await judicial approval. The approximately $400 million in civil penalties includes:

$305 million payable to the U.S. Environmental Protection Agency (EPA), U.S. Department of Justice (DOJ) and the California Air Resources Board (CARB) for environmental claims
$13.5 million to the California Attorney General for consumer claims and mitigation expenses
$72.5 million to various other state attorneys general for environmental and consumer claims
$6 million to Customs and Border Protection

In addition, FCA US will pay $19 million to the State of California for emissions mitigation initiatives, while also financing the upgrade of 200,000 high-efficiency catalytic converters through the aftermarket.

Affected customers will be advised when they may schedule service appointments. FCA US is in the process of establishing the required logistics to identify vehicle owners and provide service and remuneration.

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Discussion Starter #88
Fiat Chrysler vs. Volkswagen:

Fiat Chrysler vs. Volkswagen: A tale of two emissions cheaters

January 28, 2019


Fiat Chrysler Automobiles became the second major automaker in four years (after Volkswagen) to resolve allegations with the government that it engaged in an emissions-cheating scandal in violation of the federal Clean Air Act and California law. With several other automakers facing related investigations, a comparison of these two cases may signal what’s to come.

On Jan. 10, Fiat Chrysler agreed to pay $397 million in total civil penalties to resolve allegations that it violated environmental and consumer protection laws by using “defeat device software” to circumvent emissions testing. In a statement announcing Fiat Chrysler’s settlement, Principal Deputy Associate Attorney General Jesse Panuccio warned that “this case demonstrates that steep penalties await corporations that engage in such egregious violations.”

The proposed $397 million in civil penalties includes $305 million to the U.S. Environmental Protection Agency (EPA), the Department of Justice, and the California Air Resources Board (CARB) for environmental claims; $13.5 million to the California Attorney General for consumer claims and mitigation expenses; $72.5 million to various other states for environmental and consumer claims; and $6 million to U.S. Customs and Border Protection for illegally importing 1,700 noncompliant vehicles. The proposed settlement must still be approved by the U.S. District Court for the Northern District of California.

In a separate settlement with California, Fiat Chrysler will pay an additional $19 million to mitigate excess emissions from 13,325 vehicles in California, on top ......

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Fiat Chrysler, Bosch agree to pay $66 million in diesel legal fees

Fiat Chrysler, Bosch agree to pay $66 million in diesel legal fees

February 7, 2019


Fiat Chrysler Automobiles NV and Robert Bosch have agreed to pay lawyers representing owners of U.S. diesel vehicles $66 million in fees and costs, according to court filing on Wednesday and people briefed on the matter.

In a court filing late on Wednesday in U.S. District Court in San Francisco, lawyer Elizabeth Cabraser said after negotiations overseen by court-appointed settlement master Ken Feinberg, the companies agreed not to oppose an award of $59 million in attorneys’ fees and $7 million in costs.


The lawyers had originally sought up to $106.5 million in fees and costs.

Under a settlement announced last month, Fiat Chrysler and Bosch, which provided emissions control software for the Fiat Chrysler vehicles, will give 104,000 diesel owners up to $307.5 million or about $2,800 per vehicle for diesel software updates.

The legal fees are on top of those costs. Fiat Chrysler and Bosch did not immediately comment late Wednesday.


Fiat Chrysler is paying up to $280 million, or 90 percent of the settlement costs, and Bosch is paying $27.5 million, or 10 percent. The companies are expected to divide the attorney costs under the same formula, meaning Fiat Chrysler will pay $60 million and Bosch $6 million, the people briefed on the settlement said.

U.S. District Judge Edward Chen must still approve the legal fees. He has set a May 3 hearing on a motion to grant final approval.

The Italian-American automaker on Jan. 10 announced it settled with the U.S. Justice Department, California and diesel owners over civil claims that it used illegal software that produced false results on diesel-emissions tests.

Fiat Chrysler previously estimated the value of the settlements at about $800 million.

Fiat Chrysler is also paying $311 million in total civil penalties and issuing extended warranties worth $105 million, among other costs.

The settlement covers 104,000 Ram 1500 and Jeep Grand Cherokee diesels from the model years 2014 to 2016.

In addition, Fiat Chrysler will pay $72.5 million for state civil penalties and $33.5 million to California to offset excess emissions and consumer claims.

The hefty penalty was the latest fallout from the U.S. government’s stepped-up enforcement of vehicle emissions rules after Volkswagen AG admitted in September 2015 to intentionally evading emissions rules.

The Justice Department has a pending criminal investigation against Fiat Chrysler.
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FCA US Announces Final Approval of Settlements

FCA US Announces Final Approval of Settlements

May 3, 2019 , Auburn Hills, Mich. -

FCA US LLC has received final approval of a class-action settlement that ends a dispute about performance of certain vehicles equipped with 3.0-liter EcoDiesel V-6 engines.

The Court also approved consent decrees between FCA US, the U.S. Environmental Protection Agency (EPA), and the California Air Resources Board (CARB) and agreements with all 50 states and U.S. Customs and Border Protection, all of which were reached in January.

The settlements contain no findings of wrongdoing, nor admission of any wrongdoing, by FCA US.


The approvals open the official benefit period for affected customers, paving the way for free engine-control software updates and an extended powertrain warranty for diesel-powered 2014-2016 Ram 1500 pickups and Jeep® Grand Cherokee SUVs.

The software update does not affect average fuel economy, drivability, durability, engine noise, vibration, or other driving characteristics of the vehicles.

The class-action settlement also provides monetary compensation to eligible customers. Class members may submit claims at www.EcoDieselSettlement.com; customers with questions may call 1-833-280-4748.

Class members who submit a timely and valid claim will receive a cash payment. Under the class action settlement, owners may receive up to $3,075, while lessees may receive up to $990. Eligible former owners and former lessees are entitled to receive up to $990.

The deadline for class-action claim submissions is February 3, 2021. Claims will not be considered if vehicle software is not updated by May 3, 2021, through a certified Jeep or Ram dealer. Former owners and lessees must submit valid claims by August 1, 2019.

As part of the separate consent decree with the EPA and CARB, FCA US has agreed to apprise an independent auditor of the status of various initiatives within the Company, such as training advancements and certification process improvements. To date, FCA US has launched three-quarters of these initiatives with one-third already complete.
 
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