VW sued by U.S. for environmental violations

WASHINGTON (Reuters) -- The U.S. Justice Department today filed a civil suit against Volkswagen AG for allegedly violating the Clean Air Act by installing illegal devices to impair emission control systems in 600,000 vehicles.The allegations in the lawsuit carry penalties that could cost Volkswagen billions of dollars, a senior Justice Department official said."The United States will pursue all appropriate remedies against Volkswagen to redress the violations of our nation's clean air laws," said Assistant Attorney General John Cruden, head of the departments environment and natural resources division.The lawsuit will be filed in the Eastern District of Michigan and then transferred to Northern California, where class-action lawsuits against Volkswagen are pending.The Justice Department lawsuit accuses Volkswagen of four counts of violating the U.S. Clean Air Act, including tampering with the emissions control system and failing to report violations."We're alleging that they knew what they were doing, they intentionally violated the law and that the consequences were significant to health," the senior Justice Department official said. The Justice Department has also been investigating criminal fraud allegations against Volkswagen for misleading U.S. consumers and regulators. Criminal charges would require a higher burden of proof than the civil lawsuit.The civil lawsuit does not preclude the Justice Department from pursuing criminal charges against Volkswagen, said the Justice Department official. Material omissionsThe suit details VW’s environmental violations and alleges that VW tried to hide them from regulators.“Volkswagen AG knowingly concealed facts that would have revealed” that about 500,000 2.0-liter diesels contained two emissions calibrations -- one for the road and another for the test lab, the complaint said. The government’s efforts to “learn the truth” about the excess 2.0-liter emissions were “impeded and obstructed by material omissions and misleading information provided by VW entities including at least VWoA and Volkswagen AG.”The complaint also made similar charges against Volkswagen AG and Audi AG for their roles in the government’s probe into “irregularities” in the 3.0-liter diesel used mainly in SUVs and larger sedans from Audi.Volkswagen acknowledged the suit in a statement, but stopped short of responding to specific claims, which it noted were included in the EPA and California Air Resources Board violation notices issued last fall.“Volkswagen will continue to work cooperatively with the EPA on developing remedies to bring the TDI vehicles into full compliance with regulations as soon as possible. In addition, we are working with Kenneth Feinberg to develop an independent, fair and swift process for resolving private consumer claims relating to these issues,” VW said in its statement. “We will continue to cooperate with all government agencies investigating these matters.”Legal implicationsVolkswagen's earlier admissions eliminate almost any possibility that the automaker could defend itself in court, said attorney Daniel Riesel of Sive, Paget & Riesel P.C, who defends companies accused of environmental crimes.To win the civil case, the government does not need to prove the degree of intentional deception at Volkswagen -- just that the cheating occurred, Riesel said. "I don't think there is any defense in a civil suit," he said.Instead, the automaker will seek to negotiate a lower penalty by arguing that the maximum would be "crippling to the company and lead to massive layoffs," Riesel said.Ryan Beene of Automotive News contributed to this report. CA10319714.PDFCopy of suitCA10319714.PDF

VW sued by U.S. for environmental violations

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