Diesel owners in Germany who sue VW face significant hurdles


2010 Volkswagen Golf TDI

2010 Volkswagen Golf TDI

Enlarge Photo

In the U.S., owners of Volkswagen 2.0-liter TDI diesel cars with illegal "defeat device" software have reached a settlement with VW—and a preliminary agreement for a smaller number of affected 3.0-liter V-6 diesels is largely, if not entirely, settled.

It may have taken months of negotiating, but 2.0-liter diesel owners can be assured of compensation, and 3.0-liter diesel owners will likely be able to get it as well.

That's not the case in Europe, where Volkswagen has no plans to offer restitution payments, buybacks, or modifications, as it will do in the U.S.

DON'T MISS: VW 3-liter diesel updates OKed, but buyback negotiations continue

Some German owners have consequently filed a lawsuit against the automaker, but they face an uphill battle.

Around 1,000 of the estimated 2.5 million affected German Volkswagen diesel owners have sued the company, and about 250 have reached settlements.

The relatively small number of suits has to do with the fact, under German law, there is no concept of class-action lawsuits, as Bloomberg explains.

2010 Volkswagen Golf TDI

2010 Volkswagen Golf TDI

Enlarge Photo

That means that if owners want to sue Volkswagen, they must do so one by one.

In the U.S., plaintiffs can band together in suits that achieve class-action status, giving them greater bargaining power and helping to coordinate the process.

But that's not the case in German courts.

MORE: VW diesel buyback advice: don't strip parts off your car first, judge warns

In addition, German law requires the loser of a case to pay all court fees, creating an intimidating financial hurdle for individual plaintiffs.

To make it easier for German owners to sue Volkswagen, U.S.-based law firm Hausfeld partnered with German website My-Right.de, in an attempt to make the process less daunting.

My-Right.de promises owners that they will face no financial risk if they sign up as plaintiffs against Volkswagen through its program.

2010 Volkswagen Golf TDI

2010 Volkswagen Golf TDI

Enlarge Photo

Plaintiffs won't have to pay fees if they lose, but could receive up to 5,000 euros ($5,200) in compensation if they win, the website promises.

The site will act as a mediator on behalf of those who register, with all cases remaining technically separate.

Yet by coordinating with multiple plaintiffs, My-Right.de may approximate a class-action suit.

It's unclear whether the strategy will succeed, but it may just prove to be a more attractive option to German VW diesel owners than filing individual suits without assistance.

If the coordinated approach encourages more owners to sue, it would certainly make it harder for Volkswagen to dismiss the situation.

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