SAN FRANCISCO (AP) — Volkswagen has agreed to pay its U.S. dealers up to $1.2 billion to compensate them for losses they said they suffered as a result of the company’s emissions cheating scandal.

Attorneys for the carmaker and dealers included the figure in a settlement agreement filed in federal court in San Francisco on Friday. Under the terms of the deal, dealers can also choose to opt out and pursue their own lawsuits against Volkswagen.

A judge still has to approve the settlement before it can go into effect.

Volkswagen previously reached an agreement with attorneys for car owners. That deal calls for it to spend up to $10 billion buying back or repairing about 475,000 vehicles involved in its scandal.

Attorneys for vehicle owners said in a court filing on Friday that more than 311,000 people have registered for the deal. </s> SAN FRANCISCO — Volkswagen has agreed to pay its U.S. dealers up to $1.2 billion to compensate them for losses they said they suffered as a result of the company’s emissions cheating scandal, according to a settlement agreement filed Friday in federal court in San Francisco.

Under the terms of the deal, dealers can choose to opt out and pursue their own lawsuits against Volkswagen. A judge still has to approve the settlement before it can go into effect.

Volkswagen previously reached an agreement with attorneys for car owners. That deal calls for it to spend up to $10 billion buying back or repairing about 475,000 vehicles involved in its scandal and paying their owners an additional $5,100 to $10,000 each.

Details about the vehicle repairs have not been finalized.

Attorneys for vehicle owners said in a court filing on Friday that more than 311,000 people have registered for the deal and less than 3,300 people have opted out. “There is resounding support for this consumer class settlement and the substantial benefits it provides,” Elizabeth Cabraser, lead attorney for Volkswagen owners, said in a statement.

The settlement also includes $2.7 billion for unspecified environmental mitigation and an additional $2 billion to promote zero-emissions vehicles.

U.S. District Court Judge Charles Breyer gave the deal preliminary approval in July, and he is expected to make a final decision on Oct. 18.

The deal does not cover about 85,000 more-powerful Volkswagens and Audis with 3-liter engines also caught up in the emissions scandal. </s> Volkswagen has agreed to pay its U.S. dealers up to $1.2 billion to compensate them for losses suffered as a result of the company’s emissions cheating scandal, according to a settlement agreement filed Friday in federal court in San Francisco.

The dealers are expected to receive about $1.85 million each, but they can choose to opt out of the deal and pursue their own lawsuits against Volkswagen. A judge still has to approve the settlement before it can go into effect.

Volkswagen’s U.S. sales have fallen since the scandal first came to light a year ago, and the agreement will help compensate dealers for what they said was a loss in value of their dealerships.

Several Los Angeles-area Volkswagen dealerships declined to comment about the settlement, with some referring questions to their attorneys.

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“The Volkswagen-branded franchise dealer class action settlement filed today represents an outstanding result for Volkswagen’s 652 franchise dealers as of Sept. 18, 2015,” said the dealers’ lead counsel Steve Berman, in a statement.

Volkswagen declined comment beyond a statement it issued Friday noting that the settlement “is not intended to apply to or affect Volkswagen’s obligations under the laws or regulations of any jurisdiction outside the United States.”

The automaker previously reached an agreement with attorneys for U.S. vehicle owners. That deal calls for it to spend up to $10 billion buying back or repairing about 475,000 vehicles involved in its scandal and paying their owners an additional $5,100 to $10,000 each.

That settlement also includes more than $2.5 billion for unspecified environmental mitigation and an additional $2 billion to promote zero-emissions vehicles.

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The dealer payout is yet another financial hit for Volkswagen, which disclosed in April that the scandal had cost the company $18.2 billion in 2015 alone.

Karl Brauer, executive publisher at Kelley Blue Book, said the billions Volkswagen is paying related to the emissions scandal sends a strong message to the industry about sidestepping regulations.

“This is a massive tab,” Brauer said. “Does this represent a strong enough message to Volkswagen and all other manufacturers? I think it does.”

While the dealers’ cut is a fraction of the overall payout, Brauer said they are receiving a substantial benefit from the agreement, which will be disbursed over 18 months.

“It’s hard to have but so much sympathy for the dealers when they’re going to get $100,000 a month for a year and a half,” Brauer said.

Also on Friday, attorneys for vehicle owners said in a court filing that more than 311,000 people have registered for compensation under automaker’s vehicle-owner deal and less than 3,300 people have opted out.

“There is resounding support for this consumer class settlement and the substantial benefits it provides,” Elizabeth Cabraser, lead attorney for Volkswagen owners, said in a statement.

U.S. District Court Judge Charles R. Breyer gave the vehicle owners’ deal preliminary approval in July, and he is expected to make a final decision on Oct. 18.

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It does not cover about 85,000 more-powerful Volkswagens and Audis with 3-liter engines also caught up in the emissions scandal.

The scandal erupted in September 2015 when the California Air Resources Board and the EPA said they had discovered software in certain 2-liter VW diesel vehicles that made the engines run more cleanly during emissions testings. In regular driving, the vehicles were found to spew up to 40 times the legally allowed amount of nitrogen oxide.

Regulators later said the software, called a defeat device, also was installed in some Volkswagen and Audi 3.0-liter diesel vehicles.

Last month, more details about the scandal emerged when a longtime Volkswagen engineer from Southern California pleaded guilty in federal court to charges he helped design and implement the software.

James Robert Liang, 62, a Newbury Park resident, pleaded guilty in federal court in Detroit to a single charge of conspiring to defraud the United States, commit wire fraud and violate the Clean Air Act. He faces up to five years in prison and a $250,000 fine.

Liang had worked in Volkswagen’s diesel development department in Wolfsburg, Germany, starting in 1983, before transferring to the company’s test facility in Oxnard. In 2006, he and other VW employees started work on a new diesel engine for U.S. vehicles, the plea agreement said.

When they realized they could not design an engine that would adhere to the strict U.S. standards while also delivering solid road performance, they created the defeat devices, according to court papers.

If the software detected the vehicle was undergoing a test, it told the car to emit only enough nitrogen oxide to pass the inspection. Otherwise, court papers said, it permitted the cars to pump substantially more nitrogen oxide into the atmosphere.

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Liang said he and his co-conspirators “misrepresented” that the VW diesel vehicles met U.S. emissions standards during certification meetings for new cars with the U.S. Environmental Protection Agency and the California Air Resources Board and “hid the existence of the defeat device from regulators,” according to the plea agreement.

Liang is cooperating with the government in an ongoing criminal investigation, the U.S. Department of Justice said last month. Such cooperation is generally a sign that federal prosecutors are seeking to charge others in a case.

The Associated Press and staff writers Samantha Masunaga and Del Quentin Wilber contributed to this article.

UPDATES:

3:30 p.m.: This article was updated with comments from the dealers’ attorney and industry expert Karl Brauer, as well as some additional details on the settlement.

1 p.m.: This article was updated with information about a plea agreement last month and additional financial details.

This article was originally published at 11:10 a.m. </s> WOLFSBURG (dpa-AFX) - Volkswagen AG (VKW.L, VLKAF.PK, VOW.BE) confirmed late Friday in a federal court filing that it has agreed to pay up to $1.21 billion to settle claims of its 652 U.S. dealerships related the emissions scandal.



The settlement, which reflects an average payout of $1.85 million to dealers, must still be approved by a judge in San Francisco.



The US dealers had suffered huge losses in the past year after the German carmaker's sales in US plunged after the firm admitted that it had equipped about 11 million diesel vehicles with illegal software to cheat on American pollution tests.



The latest settlement is separate from a recent $14.7 billion agreement between the company, the U.S. government, California regulators and diesel car owners.



According to a court filing Friday, 311,209 US diesel car owners among the total affected owners of 475,000, have registered for the settlement offer. Meanwhile, some 3,298 Volkswagen owners opted out of the deal.



The company has also agreed to take back the affected diesel cars still owned by dealers at the same terms offered to consumers.



Meanwhile, in late September, Volkswagen shareholders filed new lawsuits in Germany seeking a total of 8.2 billion euros or about $9.2 billion in damages, as they lost billions as the carmaker's share value plunged post the scandal. As per reports, more than 1,400 complaints were filed in a regional court in Germany's Braunschweig, near Volkswagen's headquarters in Wolfsburg.



Copyright RTT News/dpa-AFX </s> San Francisco. German auto giant Volkswagen has agreed to pay US suppliers some $1.2 billion to settle claims emanating from the “Dieselgate” pollution scandal, the firm and suppliers said late yesterday.

Volkswagen issued a statement saying it had reached an agreement in principle with VW-branded suppliers after more than a month finalizing the accord.

“Under the proposed agreement, Volkswagen has agreed to make a maximum total of $1.208 billion in cash payments to eligible dealers and to provide additional benefits to resolve alleged past, current and future claims of losses in franchise value,” the statement read.

Both parties had announced an agreement in principle on August 25.

The finalized accord was filed with the district court for the Northern District of California in San Francisco where it is subject to the approval of a judge.

The cash -- half up front and half in monthly instalments over 18 months -- will be shared among 652 dealers, lawyers representing them said, for an average settlement of around $1.9 million.

Volkswagen has also agreed to buy back affected vehicles still in dealer lots.

The deal comes on top of the $14.7 billion in US compensation and fines Volkswagen has already agreed to pay regarding some 480,000 two-liter models.

The firm has yet to find a solution regarding a further 80,000 3-liter models affected by the scam.

US authorities have given the company until the end of this month to show if they can be fixed.

Volkswagen has been struggling to rise above the fallout of a scandal which emerged in September 2015 when it admitted installing so-called “defeat devices” in 11 million diesel vehicles worldwide, which increase exhaust treatment when the car detects it is undergoing regulatory off-road tests. </s> Volkswagen investors are demanding more than $9 billion in damages for the losses they sustained as a result of the automaker's huge diesel emissions scandal.

Around 1,400 lawsuits have been filed against Volkswagen (VLKAF) in Germany. The investors want payments totaling 8.2 billion euros ($9.1 billion), according to a statement from a court in Volkswagen's home state of Lower Saxony.

About 40% of the company's market value was wiped out when the scandal broke a year ago. Volkswagen admitted fitting as many as 11 million diesel vehicles worldwide with software that could cheat nitrogen oxide emissions tests.

But it only came forward after the U.S. Environmental Protection Agency alerted the world to the issue.

Investors say Volkswagen failed to provide accurate and timely information about its cheating on emissions tests. Prosecutors are investigating whether former Volkswagen CEO Martin Winterkorn and another top executive should have come cleaner sooner about the possible financial costs of the scandal.

In April, the company recorded a loss of 5.5 billion euros ($6.2 billion) for 2015, after taking a 16.2 billion euro charge.

The German court said it has been swamped with lawsuits, and has even had to increase its storage capacity. It said the number of claims against Volkswagen is equivalent to half its normal annual workload.

Two of the lawsuits, worth 2 billion euros, were filed by institutional investors, and the rest by private investors.

Norway's state pension fund, Volkswagen's biggest independent shareholder, said in May it would sue the car maker for the losses it suffered. Blackrock (BLK), another top investor, is also reported to be suing the company.

Volkswagen has already agreed to pay $15.3 billion in civil penalties to compensate owners of its U.S. diesel cars, including an agreement to fix or buy back the cars. </s> It represented one of the biggest corporate settlements of any kind. The action by U.S. District Judge Charles Breyer in San Francisco marked a pivotal moment for VW as it aims to move past a scandal that has engulfed the company since it admitted in September 2015 to installing secret software in diesel cars to cheat exhaust emissions tests and make them appear cleaner than they really were.

Hinrich Woebcken, president and CEO of Volkswagen Group of America Inc, called final approval of a settlement first announced in June "an important milestone in our journey to making things right in the United States," and pledged to carry out the terms "as seamlessly as possible."

Breyer turned away objections from car owners who thought the settlement did not provide enough money, saying it "adequately and fairly compensates" them. In addition to the pre-scandal "trade in" value of the vehicle, owners will receive $5,100 to $10,000 in additional compensation.

"Given the risks of prolonged litigation, the immediate settlement of this matter is far preferable," Breyer wrote.

The settlement was reached with the U.S. Justice Department, Federal Trade Commission, the state of California and vehicle owners who had filed a class action lawsuit against the world's No. 2 automaker. VW has admitted to misleading regulators and still faces an ongoing criminal investigation.

Volkswagen agreed to spend up to $10.033 billion on the buybacks and owner compensation and $4.7 billion on programs to offset excess emissions and boost clean-vehicle projects.

VW may also be allowed to repair vehicles if regulators approve fixes. The affected vehicles emit up to 40 times legally allowable pollution levels.

It represented the largest civil settlement worldwide ever reached with an automaker accused of misconduct.

While huge, the approved deal was still smaller than the $246 billion settlement reached by cigarette makers with 46 U.S. states in 1998 and the $53 billion by BP to address costs and penalties arising from the 2010 Gulf of Mexico oil spill.

In total, Volkswagen has agreed to date to spend up to $16.5 billion in connection with the scandal, including payments to dealers, states and attorneys for owners. The scandal rattled VW's global business, harmed its reputation and prompted the ouster of its CEO.

The settlement covers 2.0-liter polluting diesel Beetle, Golf, Jetta, Passat and Audi A3 cars from the 2009 through 2015 model years. Up to 490,000 people will take part in the settlement because some vehicles had multiple owners.

Volkswagen spokeswoman Jeannine Ginivan said the automaker expects to begin buying back vehicles in mid-November. VW has hired 900 people, including one to be stationed at each dealership, to handle buybacks.

VW still faces billions more in costs to address 85,000 polluting 3.0 liter vehicles and Justice Department fines for violating clean air laws. It also faces lawsuits from at least 16 U.S. states for additional claims that could hike the company's overall costs.

Last month, a Volkswagen engineer pleaded guilty to helping the company evade U.S. emission standards. His lawyer said he would cooperate with federal authorities in their criminal probe.

In 2013, a non-profit group commissioned researchers at West Virginia University to test diesel car emissions, and found excess emissions in two VW diesels. After the U.S. Environmental Protection Agency and California spent more than a year trying to understand the cause, VW admitted last year it secretly installed software to turn off emissions equipment in real-world driving.

"Today is a landmark day, when this innovative settlement can be put into action, investing billions of dollars into public health protections to remedy these serious violations," Cynthia Giles, the EPA's assistant administrator, said.

VW will provide $2 billion over 10 years to fund programs to promote construction of electric vehicle charging infrastructure, development of zero-emission ride-sharing fleets and other efforts to boost sales of cars that do not burn petroleum.

Volkswagen has been in intensive talks over how much compensation it may offer owners of the larger 3.0 liter diesel Porsche, Audi and Volkswagen vehicles that emit up to nine times legally allowable emissions and whether it will offer buybacks for some of the polluting SUVs but no final agreement has been reached. Volkswagen faces a Nov. 3 court hearing to update the court on those vehicles' status.

Volkswagen agreed to make up to $1.21 billion in payments to 652 U.S. VW brand dealers and $600 million to 44 U.S. states to address some state claims.

Nearly 340,000 owners have registered to take part in the settlement. About 3,500 owners have opted out. Volkswagen must fix or buy back 85 percent of the 475,000 vehicles under the agreement by June 2019 or face additional costs. </s> SAN FRANCISCO (AP) — A federal judge approved the largest auto-scandal settlement in U.S. history Tuesday, giving nearly a half-million Volkswagen owners and leaseholders the choice between selling their cars back or having them repaired so they don’t cheat on emissions tests and spew excess pollution.

U.S. District Judge Charles Breyer said the nearly $15 billion deal “adequately and fairly” compensates consumers and gets the polluting vehicles off the road as soon as possible.

The German automaker acknowledged last year that about 475,000 Volkswagens and Audis with 2-liter, four-cylinder diesel engines were programmed to cheat on emissions tests.

Under the agreement, owners can choose to have Volkswagen buy back their vehicle regardless of its condition for the full trade-in price on Sept. 18, 2015, when the scandal broke, or pay for repairs. Either way, Volkswagen also will pay owners $5,100 to $10,000, depending on the age of the car and whether the owner had it prior to Sept. 18 of last year.

Volkswagen has agreed to spend up to $10 billion compensating consumers and could start buying back the cars as early as next month. Regulators have not approved any fixes.

The settlement also includes $2.7 billion for unspecified environmental mitigation and $2 billion to promote zero-emissions vehicles.

“We’re going to sell it back as soon as humanly possible and try to put this behind us,” said Joe Azam, a 35-year-old attorney in New York who owns a 2014 Jetta wagon.

Still, Azam said he thought Volkswagen “got off easy” in how much it was paying vehicle owners.

Blair Stewart, a 2012 Jetta wagon owner in Palo Alto, California, said Volkswagen should have paid owners the full purchase price of their vehicle, given the company’s fraud.

“This is not enough to deter the kind of behavior they did,” he said.

Breyer concluded that affected car owners were not entitled to a full refund because many had “received a great deal of use out of their vehicles.” He also raised the specter of bankruptcy for Volkswagen if it had to pay the full purchase price.

The scandal has damaged Volkswagen’s reputation and hurt its sales. The company is still facing potentially billions more in fines and penalties and possible criminal charges. It also will pay up to $332.5 million in attorney fees and costs and up to $1.2 billion to its U.S. dealers.

The settlement’s approval “is an important milestone in our journey to making things right in the United States,” Hinrich J. Woebcken, president and CEO of Volkswagen Group of America Inc. said in a statement. “Volkswagen is committed to ensuring that the program is now carried out as seamlessly as possible for our affected customers and has devoted significant resources and personnel to making their experience a positive one.”

The lead attorney for car owners, Elizabeth Cabraser, said in a statement that the deal “holds Volkswagen accountable for its illegal behavior and breach of consumer trust.” More than 330,000 people have signed up for settlement benefits, with about 3,200 opting out, she told the judge last week.

Peggy Schaeffer, a North Carolina librarian with a diesel 2010 Jetta wagon, said she was pleased with the settlement terms and has submitted her buyback paperwork. She expects to get close to $15,000 for a car she bought for $16,000 in 2010.

“It’s hard to be grumpy about that,” she said.

The company said in April that it has set aside $18.2 billion to cover the cost of the global scandal, which erupted last year when the U.S. Environmental Protection Agency said Volkswagen had fitted many of its cars with software to fool emissions tests. Car owners and the U.S. Department of Justice sued.

The software recognized when the cars were being tested on a treadmill and turned on pollution controls. The controls were turned off when the cars returned to the road. The EPA alleged the scheme let the cars spew up to 40 times the allowable limit of nitrogen oxide, which can cause respiratory problems in humans.

Through September, VW Group’s sales in the U.S. are down nearly 7 percent from 2015 figures, to just under 386,000 vehicles. The Volkswagen brand fared worse, with sales down 12.5 percent, to just over 231,000 vehicles, according to Autodata Corp. The VW Group includes the Audi, VW, Bentley and Lamborghini brands.

The settlement releases legal claims from most of the 2-liter engine owners, but it doesn’t affect larger 3-liter, six-cylinder diesels, which also cheated on tests. It also doesn’t end claims against parts supplier Robert Bosch, which drew up the cheating software.

FILE - In this Sept. 22, 2015, file photo, the amount of carbon dioxide emissions is written on a Volkswagen Passat Diesel at the Frankfurt Car Show in Frankfurt, Germany. A federal judge in San Francisco is facing a deadline on whether to approve a nearly $15 billion deal over Volkswagen's emissions cheating scandal that gives most affected car owners the option of having the company buy back their vehicles. U.S. District Judge Charles Breyer said at a hearing last week that he was strongly inclined to give the deal final approval and would issue a ruling by Tuesday, Oct. 25, 2016. (AP Photo/Michael Probst, File) FILE - In this Sept. 22, 2015, file photo, the amount of carbon dioxide emissions is written on a Volkswagen Passat Diesel at the Frankfurt Car Show in Frankfurt, Germany. A federal judge in San Francisco is facing a deadline on whether to approve a nearly $15 billion deal over Volkswagen's emissions cheating scandal that gives most affected car owners the option of having the company buy back their vehicles. U.S. District Judge Charles Breyer said at a hearing last week that he was strongly inclined to give the deal final approval and would issue a ruling by Tuesday, Oct. 25, 2016. (AP Photo/Michael Probst, File) FILE - In this July 19, 2016, file photo, New York Attorney General Eric Schneiderman announces a lawsuit against Volkswagen in New York. A federal judge in San Francisco is facing a deadline on whether to approve a nearly $15 billion deal over Volkswagen's emissions cheating scandal that gives most affected car owners the option of having the company buy back their vehicles. U.S. District Judge Charles Breyer said at a hearing last week that he was strongly inclined to give the deal final approval and would issue a ruling by Tuesday, Oct. 25, 2016. (AP Photo/Mark Lennihan, File) FILE - In this July 19, 2016, file photo, New York Attorney General Eric Schneiderman announces a lawsuit against Volkswagen in New York. A federal judge in San Francisco is facing a deadline on whether to approve a nearly $15 billion deal over Volkswagen's emissions cheating scandal that gives most affected car owners the option of having the company buy back their vehicles. U.S. District Judge Charles Breyer said at a hearing last week that he was strongly inclined to give the deal final approval and would issue a ruling by Tuesday, Oct. 25, 2016. (AP Photo/Mark Lennihan, File) In this Oct. 13, 2015, file photo, a Volkswagen Touareg diesel is tested in the Environmental Protection Agency’s cold temperature test facility in Ann Arbor, Mich. In this Oct. 13, 2015, file photo, a Volkswagen Touareg diesel is tested in the Environmental Protection Agency’s cold temperature test facility in Ann Arbor, Mich. </s> WASHINGTON (Reuters) - Volkswagen AG (VOWG_p.DE), in another step to move past its costly diesel emissions cheating scandal, has agreed to pay $175 million to U.S. lawyers suing the German automaker on behalf of the owners of 475,000 polluting vehicles, two people briefed on the agreement said on Friday.

A VW sign is seen outside a Volkswagen dealership in London, Britain, November 5, 2015. REUTERS/Suzanne Plunkett/File photo

In August, the lawyers in the class action litigation sought up to $332.5 million in fees and costs for their work in a $10 billion settlement that gives U.S. owners of 2.0 liter polluting cars the ability to sell back their vehicles to Volkswagen (VW).

The latest deal with the lawyers means VW now has agreed to spend up to $16.7 billion to compensate U.S. owners and address claims from states, federal regulators and dealers arising from the “Dieselgate” scandal.

The amount to be paid out to lawyers was first reported by Reuters on Friday.

The resolution of legal fees clears another hurdle as the world’s No. 2 automaker looks to resolve all of the outstanding aspects of a scandal that disrupted its global business, hurt its reputation and led to the ouster of its chief executive officer last year.

VW in September 2015 admitted using sophisticated secret software in its cars to cheat exhaust emissions tests, with millions of vehicles worldwide affected. The cheating allowed VW’s U.S. vehicles sold since 2009 to emit up to 40 times legally allowable pollution levels.

The $175 million includes attorneys’ fees and other costs, according to the sources, who spoke on condition of anonymity.

Lawyers for the owners of polluting vehicles and a spokeswoman for Volkswagen declined to comment.

Lead plaintiff lawyer Elizabeth Cabraser, who is part of a committee of 22 lawyers overseeing the owner suits, said in August the amount sought in attorneys fees was far less than the “judicially established benchmark” for class actions of approximately 25 percent of the settlement amount.

U.S. District Judge Charles Breyer on Tuesday is set to hold a hearing in San Francisco on whether to grant final approval of the vehicle owners’ settlement announced in June, which would be the largest-ever automotive buy-back offer in the United States. Breyer must also decide whether to approve the legal fee agreement.

VW has agreed to spend up to $10.033 billion to buy back the vehicles and compensate owners. It may also offer vehicle fixes if regulators approve. Under a timetable announced this summer, regulators could approve a fix for some 2015 VW diesel vehicles as early as next month.

In addition, VW has agreed to pay up to $1.21 billion to compensate U.S. VW brand dealers, pay more than $600 million to 44 U.S. states, spend $2 billion on zero-emission vehicle promotion and infrastructure, and another $2.7 billion to offset diesel pollution.

It still faces billions of dollars in potential fines from the U.S. Justice Department in its criminal probe into VW’s cheating scandal, and must resolve the fate of larger vehicles that were not part of the initial $10 billion settlement.

VW and U.S. regulators are in continuing discussions over whether the automaker should agree to buy back 85,000 larger 3.0-liter Porsche, Audi and VW vehicles that also exceeded U.S. emission standards, and whether it should offer additional compensation to those owners.

VW may have to pay additional owner attorneys’ fees as part of a separate potential 3.0-liter settlement, the sources said.
Volkswagen agrees to pay its U.S. dealers up to US$1.2 billion to compensate them for their losses resulting from the company's emissions cheating scandal.