Volkswagen Liable for Defeat Devices, Top EU Court Rules

The European Court of Justice on Friday ruled that carmakers like Volkswagen remain liable for using unlawful defeat devices, such as temperature-sensitive emissions software, even if the vehicles met EU standards, which doesn’t guarantee the technology’s legality.

The case at the European Union’s top court arose from two German lawsuits involving Volkswagen diesel vehicles fitted with defeat devices, either during production or through later software updates.

The Court said compensation to buyers can be reduced based on vehicle use or capped at 15% of the purchase price, but it must still adequately reflect the damage caused.

“The impact on Volkswagen is expected to be limited, as only a few diesel-related lawsuits are still pending before German courts,” Volkswagen said.

“In our view, today’s ECJ decision will not change that,” the German carmaker added.

Defeat devices are tools or software that alter vehicle emissions, triggering legal disputes over whether manufacturers misuse them to conceal true pollution levels. Carmakers have argued these devices only activate at certain temperatures to protect the engine and comply with the law.

Volkswagen was found to have hidden excessive levels of toxic diesel emissions in 2015, a scandal that led to a management rout and thousands of regulatory probes and lawsuits which are taking years to settle.

(Reporting by Van Campenhout; Editing by Kirsten Donovan)