Court orders full reimbursement for VW diesel owner in Germany


2010 Volkswagen Golf TDI

2010 Volkswagen Golf TDI

A lot has been said about Volkswagen's use of "defeat device" software in diesel cars to cheat on emissions tests, but a German court may win the prize for most-creative description.

VW "defeat device" software is like putting horse meat in lasagna, three German judges decreed during a recent hearing related to the diesel scandal.

Besides unleashing that vivid image, the hearing was also a major coup for German Volkswagen TDI diesel owners.

DON'T MISS: Diesel owners in Germany who sue VW face significant hurdles

That's because the judges ordered VW to reimburse a diesel owner for the full purchase price of his car, according to Bloomberg.

Germany does not allow class-action lawsuits, so diesel owners seeking compensation must sue the company individually, which presents a major obstacle to obtaining that compensation.

Class-action suits give consumers greater leverage by allowing them to bargain with an opponent as a group, but in Germany, consumers must go to court one by one.

2014 Skoda Yeti

2014 Skoda Yeti

German law also requires the loser of a case to pay all court fees, another impediment as it can pose a significant financial impact for individual plaintiffs.

But it's possible that this court decision may set a precedent for future diesel lawsuits by owners against Volkswagen.

ALSO SEE: VW settles diesel cheating cases: felony pleas, $4.3 billion fines

The court ordered VW to buy back a Skoda Yeti—a utility model sold by the automaker's Czech value brand—and pay the owner 26,500 euros ($28,300).

Volkswagen intentionally committed fraud, the court said in a statement, suggesting that use of "defeat device" software was known throughout the company's ranks.

2010 Volkswagen Golf TDI

2010 Volkswagen Golf TDI

"The use of engine software is a decision with enormous economic ramifications, so it's hardly believable that it was taken by a low-ranking developer," said the court, which is located in the city of Hildesheim, about an hour's drive from VW's Wolfsburg headquarters.

The decision is reportedly the second this month by a German court ordering Volkswagen to compensate diesel owners.

MORE: VW 3-liter diesel updates OKed, but buyback negotiations continue

The automaker has no plans to offer restitution payments, buybacks, or modifications to all affected owners, as it will do in the U.S.

At least the Hildesheim court's decision makes individual lawsuits a more plausible avenue for owners to get that compensation than it previously was.

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