The U.S. Supreme Court has rejected Volkswagen AG's appeal to avoid lawsuits filed by officials in three states seeking damages over the automaker's diesel emissions tampering.
The justices refused to hear appeals by VW and German auto supplier Robert Bosch LLC after a lower court ruling allowed Florida's Hillsborough County and Utah's Salt Lake County to hold the companies liable under local laws and regulations for tampering with vehicle emissions controls. The court also rejected VW's appeal over a similar ruling in the state of Ohio.
A VW spokesperson noted the court's decision not to hear the appeals was not a “determination of the merits” of the company's legal arguments. The company spokesperson expressed confidence in its factual and legal defenses, including software updates that reduced emissions. VW plans to vigorously contest claims of emissions tampering.
Volkswagen subsidiary Volkswagen Group of America Inc. has argued that under the Clean Air Act, only the federal government can pursue such claims. The automaker already has reached a settlement of more than $20 billion with the U.S. Environmental Protection Agency.
The lawsuits accused VW of deceiving the EPA and violating local laws.
A spokesperson for lawyers representing the two counties added that the Supreme Court's action “reaffirmed that local governments play a critical role in combating air pollution.”
The court asked the Biden Administration to weigh in on the dispute. The Biden Administration urged justices not to hear the matter, saying the Clean Air Act allows enforcement of state laws.
In one case, Volkswagen sought to overturn a 2020 ruling by the San Francisco-based 9th U.S. Circuit Court of Appeals. The 9th Circuit ruled the Clean Air Act did not preempt local efforts to impose liability over vehicles that VW had tampered with after it sold them. The 9th Circuit agreed with VW that they could not hold the company liable under local anti-tampering laws for actions taken pre-sale.
Volkswagen also sought to overturn a similar ruling by the Ohio Supreme Court in June.
VW reported it could face huge damages in the cases and potentially others. Daimler AG and Fiat Chrysler, part of Stellantis NV, face similar claims.
Volkswagen has already agreed to pay $1.5 million to settle similar claims in New Hampshire and Montana.
The issues arose after Volkswagen disclosed in 2015 that it had used sophisticated software to evade nitrogen oxide emissions requirements in nearly 11 million vehicles worldwide. The automaker also misled the EPA, which began asking questions about the changes in 2014.
Besides equipping vehicles with “defeat devices” before dealers sold them, VW also installed software updates after sale, which was the conduct at issue before the Supreme Court. VW did not disclose the true purpose of the updates when they made them.