Pending Consumer Class Action
In late 2015, Volkswagen shocked the automobile market by admitting that it had built a mechanism into its purportedly “clean” diesel vehicles that caused the vehicles to cheat on U.S. emissions tests. Hundreds of lawsuits were filed immediately after this fraud was revealed, and VW quickly moved to settle with hundreds of thousands of affected consumers.
But VW excluded from the settlements consumers who purchased or leased VW’s “clean” diesel vehicles, but who no longer owned the vehicles at the time the fraud was announced.
In August 2017, Paynter Law together with Hagens Berman Sobol & Shapiro sued VW and its co-conspirator Bosch, on behalf of these excluded consumers. The class action lawsuit, Nemet v. Volkswagen Group of America Inc., et al., No. 3:17-cv-04372 (N.D. Cal., Filed Aug. 2, 2017), alleged that plaintiffs paid a premium for their diesel vehicles, and were thus harmed by VW’s fraud.
VW and Bosch sought to have the case dismissed, arguing that the new plaintiffs were not harmed because they sold their vehicles before the public became aware of the emissions cheating; however, in a hearing in October 2018, Judge Charles Breyer, of the United States District Court for the Northern District of California, disagreed, siding with the consumer plaintiffs and allowing their case to move forward. Judge Breyer noted that plaintiffs had alleged they paid a premium for their vehicles, and that “by increasing the cost of the cars, the premium also increased the amount by which the cars depreciated.” This extra depreciation meant that plaintiffs might still have been harmed by the fraud, even though they had sold their vehicles before the fraud was announced.
Judge Breyer’s decision paved the way for the discovery phase of the case, in which the parties will exchange documents and begin preparing the case for trial.
The lead attorneys on the case for the firm are Stuart Paynter, Celeste Boyd, and Jennifer Murray, and the firm is co-counsel in the action with the law firm of Hagens, Berman Sobol & Shapiro LLP, whose Managing Partner Steve Berman argued against VW’s motion at the August hearing before Judge Breyer.