Volkswagen must buy back ‘dieselgate’ cars: Germany’s top court

Volkswagen (VW) must reimburse German car owners who bought vehicles fitted with devices able to cheat emissions tests, but the buyback amount will depend on mileage, Germany’s top court has said, in principle upholding a lower court decision.

Monday’s ruling by the Federal Court of Justice in Karlsruhe set an important precedent for hundreds of thousands of German people affected by the “dieselgate” scandal that has rocked VW since 2015.

About 60,000 similar individual German VW owners’ cases are already open.

“Volkswagen now aims to soon bring these cases to a close in agreement with the plaintiffs,” the company said in a statement, promising “appropriate offers” to affected owners.

The mileage discount limited VW from a significantly higher financial blow.

Monday’s case involved 65-year-old Herbert Gilbert from the southwest German state of Rhineland-Palatinate who sought a full refund for a used Sharan minivan he bought in 2014.

A previous court ruling ordered VW to pay Gilbert 25,616 euros ($27,930) and accept his return of the car.

That payout would have been almost 6,000 euros ($6,542) below the original purchase price, as the judges took into account depreciation on the car.

But both VW and Gilbert appealed, with the company disputing the grounds for reimbursing the pensioner, while the plaintiff said he should be paid the full purchase price.

Lead judge Stephan Seiters in Monday’s case revisited the familiar story of how VW “for many years systematically brought vehicles onto the market whose software was programmed so that they only met (emissions) limits under test conditions”.

Judges said the mere fact of selling the modified car to the plaintiff harmed him – even though VW has always argued the vehicles were “usable” for their intended purpose.

Previous cases

In late April, the company arranged an out-of-court settlement for a mass lawsuit by hundreds of thousands of plaintiffs. It agreed to pay out at least 750 million euros ($818m) to 235,000 drivers.

Buybacks, fines and compensation payments in the United States alone account for most of the more than 30 billion euro ($32.7bn) cost of the scandal to the manufacturer so far.

On the criminal side, the present chief executive, Herbert Diess, and supervisory board boss Hans Dieter Poetsch are off the hook on charges of market manipulation from Brunswick prosecutors, after VW paid a total of nine million euros ($9.8m) to settle the charges.

But a case remains open against Martin Winterkorn, VW CEO at the time the diesel cheating was uncovered, as well as Rupert Stadler, former chief of subsidiary Audi.

Meanwhile, a continuing Stuttgart probe targets supervisory board chairman Poetsch.

And a major court case continues by investors demanding compensation for their VW shares’ plunge in value after “dieselgate” came to light.