Kentuckians Will Get $100 Million From Volkswagen Settlement

Jun 29, 2016

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Kentuckians who bought Volkswagen’s “clean diesel” cars will receive restitution, and the state will get millions to offset pollution. The details of the settlement were announced Tuesday.

Dozens of class action lawsuits were filed last year after the German car company admitted it had rigged many of its vehicles to cheat emissions tests. These cars — including 2009-2015 Jettas, 2010-2015 Audi A3s and Golfs, and 2012-2015 Beetles and Passats — were billed as “clean diesel.” In fact, they emitted more pollution than was advertised.

Louisville attorney Alex Davis filed an initial class action lawsuit on behalf of local Volkswagen owner Robert Wagner and others. That lawsuit was eventually consolidated with others filed by attorneys and state attorneys general.

“We’re still evaluating the details; this is a very complicated settlement,” Davis said. “But my initial impression is that this is going to go a long way toward making things right with all of Volkswagen’s customers.”

Kentucky Attorney General Andy Beshear announced the settlement Tuesday, and estimated the total value will exceed $100 million for Kentuckians.

There are three main parts of the settlement: owner restitution, an environmental trust and civil penalties. For anyone in Kentucky who owns one of the Volkswagen’s affected by the scandal, the first one is the most pertinent.

So, here’s what you get.

•    Everyone eligible has the option of either selling their vehicle back to Volkswagen at its pre-scandal value, or having the emissions system modified to meet pollution standards.

•    Regardless of which option you choose, there’s also an additional payment.

  1.     If you bought the vehicle before September 18, 2015: Everyone eligible gets a lump sum payment, regardless of whether they choose to sell the car back or modify it. That amount depends on how much the car is worth; it’ll be at least $5,100 but could be more if 20 percent of the vehicle’s value is more than that amount.
  2.     If you bought the vehicle after September 18, 2015: Everyone eligible gets half of what the people who bought their cars earlier get (see above), plus an additional amount of money from a pool that’s set aside and divvied up among eligible owners.

•    If you have a loan on your vehicle and choose to sell it back, Volkswagen will pay off the balance of the loan and give you a check for the rest.

•    If the amount of money owed on the vehicle is more than the payout, Volkswagen will pay off the outstanding loan, up to 130 percent of what your payout would be.

Beshear said that 3,200 Kentuckians will be individually affected by the settlement.

The settlement also sets up a national environmental trust to reduce nitrogen oxides, which is the major pollutant emitted by Volkswagen’s diesel vehicles. Beshear said Kentucky’s initial share of that money is at least $19 million.

“We’ll be working with other entities within state government on the use of those funds and those projects that will reduce those emissions,” he said. “We are very excited about that portion of the settlement and we think that is of incredible value and can support some very important projects that will improve the overall health of Kentuckians into the future.”

Volkswagen will also pay millions in civil penalties, including $3,471,600 to Kentucky. That’s $1,100 for every affected vehicle sold in the commonwealth.

Final approval of the settlement is expected in October.