Case 3:15-md-02672-CRB Document 1781 Filed 08/26/16 Page 1 of 4

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JONATHAN COHEN, DC Bar 483454;jcohen2@ftc.gov 

MICHELLE L. SCHAEFER, DC Bar 478773 ; mschaefer@ftc.gov 

SANGJOON "SIMON" HAN, DC Bar 998971; shan@ftc .gov 

MEGAN A. BARTLEY, VA Bar 81840; mbartley@ftc.gov 

Federal Trade Commission 

600 Pennsylvania Avenue NW, CC-9528 

Washington, DC 20580 

(202) 326-2551 (Cohen); -3515 (Schaefer); 

-2495 (Han); -3424 (Bartley); -3197 (fax) 

Attorneys for Plaintiff Federal Trade Commission 

UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF CALIFORNIA 

IN RE: VOLKSWAGEN "CLEAN DIESEL" MDL DOCKET NO. 2672 CRB (JSC) 

10 MARKETING, SALES PRACTICES AND 

PRODUCT LIABILITY LITIGATION FEDERAL TRADE COMMISSION'S 

STATEMENT SUPPORTING THE 

SETTLEMENT 

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This document relates to: 

The Honorable Charles R. Breyer 

ALL ACTIONS (except securities actions) 

The Federal Trade Commission strongly supports the proposed $10 billion 2.0L "Clean 

Diesel" settlement, which fully compensates victims of Volkswagen's unprecedented deception. 

However, because the FTC's calculations differ from the private plaintiffs' and because the 

difference has engendered some consumer confusion, the FTC submits this statement explaining 

its view of why the $10 billion settlement is appropriate. 

To be made whole, consumers must receive full compensation for their vehicles' full 

retail value and all other losses caused by Volkswagen's deception. Full compensation has to be 

sufficient for consumers to replace their vehicle. Because almost all consumers have to do so on 

the retail market, the FTC started its calculations with the National Association of Auto Dealers 

("NADA") Clean Retail value for his or her vehicle before the scandal broke - "what a person 

In re Volkswagen "Clean Diesel" Marketing, Sales Practices & Products Liability Litigation, MDL No. 2672 

FTC STATEMENT SUPPORTfNG THE SETTLEMENT 

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Case 3:15-md-02672-CRB Document 1781 Filed 08/26/16 Page 2 of 4

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could reasonably pay for a vehicle [in good condition] at a dealer's lot."1 The Commission then 

added all other losses consumers incurred, and would incur, because of Volkswagen's deception, 

including the "shoe leather" cost of shopping for a new car, sales taxes and registration, the 

value of the lost opportunity to drive an environmentally-friendly vehicle, and the additional 

amount "Clean Diesel" consumers paid for a vehicle feature (clean emissions) that Volkswagen 

falsely advertised. 

The proposed private settlement provides the same generous, but appropriate, 

compensation to each consumer as the FTC Order. Unfortunately, the fact that it starts its 

calculation with the pre-scandal NADA Clean Trade value has caused confusion.2 Nonetheless, 

using various adjustments to significantly increase payments above Clean Trade, the proposed 

private settlement provides the same appropriate, generous compensation as the FTC's 

settlement package. Accordingly, the proposed private settlement is clearly in the public 

interest. Indeed, if it were not, the FTC would never have approved the same amounts in its 

settlement. See, e.g., United States v. Cannons Eng'g Corp. , 899 F.2d 79, 84 (1st Cir. 1990) 

(explaining that deference is appropriate "where, as here, a government actor committed to the 

protection of the public interest has pulled the laboring oar in constructing the proposed 

settlement") (citing FTC v. Standard Fin. Mgmt. Corp., 830 F.2d 404, 408 (1st Cir. 1987) 

(discussing need for judicial deference "to the agency's determination that the settlement is 

appropriate"); State of California Dep 't of Toxic Substances Control v. Waymire Drum Co., No. 

C-98-03834, 1999 WL 169536, *2 (N.D. Cal. Mar. 19, 1999) (quoting Cannons; "The 

1 See www.nada.com/b2b/support/glossary.aspx (viewed Aug. 13, 2016). The NADA 

Guide (J.D. Power) is not the only source of retail price information. In other cases, other 

sources might be appropriate. 

2 Clean Trade, standing alone, cannot provide sufficient funds for consumers to replace 

their current vehicles with comparable cars. A dealer cannot offer consumers the retail price for 

a trade-in vehicle, account for overhead, and then resell it (at the retail price) and make a profit. 

Thus, retail values always exceed trade-in values. 

In re Volkswagen "Clean Diesel" Marketing, Sales Practices & Products Liability Litigation, MDL No. 2672 

FTC STATEMENT SUPPORTING THE SETTLEMENT 

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Case 3:15-md-02672-CRB Document 1781 Filed 08/26/16 Page 3 of 4

presumption in favor of settlement is particularly strong where a consent decree has been 

2 negotiated by a governmental agency specially equipped, trained, or oriented in the field."). 

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Dated: August 26, 2016 

/ ffe!JSltl1an Cohen (jcohen2@ftc.gov) 

chelle L. Schaeffer (mschaefer@ftc.gov) 

' ' Sangjoon "Simon" Han (shan@ftc.gov) 

Megan A. Bartley (mbartley@ftc.gov) 

Federal Trade Commission 

600 Pennsylvania Avenue NW, CC-9528 

Washington, DC 20580 

(202) 326-2551 (Cohen); -3515 (Schaefer); -2495 

(Han); -3424 (Bartley); -3197 (fax) 

Attorneys for Plaintiff Federal Trade Commission 

In re Volkswagen "Clean Diesel" Marketing, Sales Practices & Products Liability Litigation, MDL No. 2672 

FTC STATEMENT SUPPORTING THE SETTLEMENT 

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Case 3:15-md-02672-CRB Document 1781 Filed 08/26/16 Page 4 of 4

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CERTIFICATE OF SERVICE 

I, Jonathan Cohen, hereby certify that on August 26, 2016, I caused to be 

served true copies of the foregoing by electronic means, by filing such documents through the 

Court's Electronic Case Filing System. 

In re Volkswagen "Clean Diesel" Marketing, Sales Practices & Products Liability Litigation, MDL No. 2672 

FTC ST A TEMENT SUPPORTING THE SETTLEMENT 

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