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Model declaratory action: VW pays 620 million euros in compensation

Model declaratory action against VW
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M it On Monday April 20, 2020, Volkswagen reached an agreement with consumer advocates on compensation as part of the negotiated settlement. The approximately 200,000 owners of VW diesel vehicles will receive a total of around 620 million euros. According to information from VW, the beneficiaries will receive amounts between 1,350 and 6,250 euros from May 5 - for this they will have to forego future lawsuits against the car manufacturer. A further 21,000 cases are still being examined in order to enable further persons entitled to settle the registration, the deadline for the subsequent submission of documents has been extended to April 30, 2020.

In mid-February, the comparison with the Federation of German Consumer Organizations (vzbz) initially failed. According to VW information, the termination was due to unfounded high demands of the litigation attorneys, who demanded a lump sum of 50 million euros for the settlement of the settlement. So that the failed settlement is not at the expense of the customer, VW wanted to offer the settlement already negotiated without the support of the vzbv Settlement negotiated, which ultimately provided for payments of 830 million euros.

If you want to accept the comparison offer, you must meet certain requirements.

  • You must have bought a vehicle with a diesel engine of the EA 189 type.
  • The vehicle must have been purchased before January 1, 2016.
  • At the time of purchase, you must have been living in Germany.
  • You must have registered by January 29 . September 2019 in the action register and may not have deregistered.
  • You may not have assigned your claims to third parties.
  • You may not have reached a previous final judgment or already concluded a settlement .

You no longer need to own the car to accept the comparison. All that matters is a documented date of purchase. An independent ombudsman will be set up for possible disputes or complaints during the settlement. If you don't get a comparison offer from VW, that doesn't necessarily mean that you don't have any claims. Only going to the lawyer helps here.

VW uses the address given by the customer when entering the register for communication. Volkswagen expects that only around 262,500 plaintiffs meet the criteria mentioned. Who thatWould like to have a lawyer examine the settlement offer, will receive a grant of 190 euros (net) from VW Anyone who rejects the settlement offer can only file an individual lawsuit.

95 percent decide in favor of the comparison

As the news broadcaster NTV reports that 95 percent of all those entitled to comparison had already registered in the relevant portal. A total of 250,000 out of 262,500 VW customers have shown interest in a comparison. 210,000 customers have uploaded their documents (for example the vehicle registration document), signaling that they want to accept the comparison.

The way to the lawsuit

Generally speaking, November 1st, 2018 may have been a completely normal Thursday. In the German case law, however, the day was downright revolutionary. Since then there has been a model declaratory action in Germany, a kind of 'class action light'. It enables consumer associations to enforce claims against companies without injured customers having to go through lengthy and expensive individual proceedings. On the same day, the first lawsuit was brought directly to the Braunschweig Higher Regional Court: by the German Consumer Association (VZBV) against Volkswagen. In this context, ten cases are processed in order to enforce compensation for all participating VW diesel drivers.

Which VW customers can join?

Most of those VW customers who own or have owned a car that has been affected by the diesel scandal. Specifically: A VW, Audi, Seat or Skoda with first registration November 1, 2008 or later, which is powered by a diesel engine with a displacement of 1.2, 1.6 or 2.0 liters from the EA189 engine family and equipped with an illegal shut-off device and was affected by the mandatory recall. In Germany alone that is around 2.5 million - and thus by far the most - Dieselgate cars. It is also irrelevant whether the arranged software and /or hardware updates have already been carried out. However, only private owners (there must be at least 50) can register and be heard as a witness - even if the car has already been sold or scrapped. Commercial owners, including, for example, craft businesses, are left out, as are gift recipients and lessees.

What do injured VW customers have to do to join?

Enter the Internet that was opened by the Federal Office of Justice at the end of November ( here the link to the form ). As things stand today, 400,000 victims have already done so. Registration is free of charge, you don't have to hire a lawyer, and you can unsubscribe up to the first day of the hearing, if you doyou don't want to complain. When the complaint register is opened, a time window opens up until the start of the hearing; after that one can no longer join. With their participation, however, injured consumers are protected from the limitation period for their claims. The VZBV takes care of everything else in cooperation with the ADAC and the law firm R /U /S /S Litigation; he also bears the litigation cost risk. Customers who decide to participate in the model declaratory action are then, however, also bound by the judgment. So also in the event that VZBV, ADAC and R /U /S /S lose in court.

For which victims is the proceedings interesting?

Who has already played with the idea There is now a low-risk alternative to initiate individual proceedings against VW. A lengthy and expensive process starts with an individual lawsuit, and not everyone has legal expenses insurance that at least cushions the cost aspect. In addition, many claims for damages against VW expire on December 31; Anyone who joins the model declaratory action is protected from it. However, you have to decide: Anyone who participates in the VZBV procedure can no longer bring an individual lawsuit. There are also injured diesel drivers who do not benefit from the model lawsuit: namely those who owned or own a V6 diesel from Audi or Porsche. And those who drive a diesel model from Daimler or Opel, for example, for which a recall has also been ordered because of illegal defeat devices.

When and where does the hearing take place?

Responsible for the model declaratory action against VW is the Braunschweig Higher Regional Court, which will be hearing on this matter from today (September 30, 2019, 10 a.m.). Due to the expected large crowds, negotiations will begin in the Congress Hall of the Braunschweig city hall. The VZBV points out that this date was the last day on which those affected could register in the complaint register. So this possibility no longer exists. Damaged parties who have registered can, however, leave until the end of the first day of the negotiation.

What could VW customers get out of the proceedings?

First of all, it is determined whether VW intentionally harmed consumers. The VZBV wants to clarify whether these customers can return their car for reimbursement of the full purchase price or whether VW can deduct usage compensation. In the event that customers want to keep their car, VW should compensate for the loss in value - or pay compensation if they have already sold the car. Above all, there is also the question of whether VW has to pay damages on top of that.

Will damaged customers automatically be awarded damages if the lawsuit is successful?

No, the injured party has not yet won any money because it - the name says it - aroundis a declaratory action and not a performance action. If it is found that VW has to pay damages in principle, the amount would have to be fought for individually by each injured party in a further process. However, the court before which this compensation is heard is bound by the declaratory judgment. For customers who have suffered damage it would still be better if VW and VZBV agree on a settlement amount, which is then divided among those customers who have joined the lawsuit.

Are VW customers who are already suing excluded?

There are already over 26,000 individual proceedings pending in German courts. Anyone who has already filed a lawsuit but has not yet received a final judgment or has reached an agreement with VW can still join the VZBV lawsuit. The ongoing proceedings will then be suspended and the outcome of the model declaratory action awaited. Although this is not binding for the individual proceedings, it should be taken into account when reaching a verdict.

What are the chances?

That is difficult to predict, after all, it is a legal premiere at national level. Naturally, both parties assess the chances completely differently. The consumer advocates are confident, while VW sees little chance of success. All cars have been regularly registered, technically safe and ready to drive, says the company. Either way, unless VW does a quick comparison, and that's what it currently looks like, it will take a long time before a decision is made. Negotiations will take place in 2019 and a judgment will be given a year later. Regardless of the decision, the unsuccessful party is likely to go to the Federal Court of Justice afterwards, which means a further delay of two to three years can be expected.

What is the difference to other class actions?

Damaged parties have other options to obtain compensation from VW without having to go to court individually and bear the legal costs. You can assign your claims to legal service providers like MyRight, who bundle many of these lawsuits, and have them litigated for you. Advantage: Immediately after the verdict, money beckons here, be it through a settlement or a victory in court. Of the amount won, the customers then have to cede 35 percent to MyRight, as a commission, so to speak. Another legal construction site is the model process by VW shareholders, in which it is clarified whether the group has informed its investors in good time about the emissions scandal. There is a model plaintiff here, the Deka Investment fund company.

What are the advantages and disadvantages of the individual types of action?

The advantage of the model declaratory action against the assignment of possible claims to service providers who then the Bundling lawsuits consists in the fact that the model declaratory action is free for the consumer. TheService providers, on the other hand, are usually rewarded with high commissions because they bear the risk and are thus rewarded for their advance performance. A major disadvantage is that the consumer has to claim damages individually in a second step. This represents a hurdle that could be traced back to successful lobbying by the industry.

What is the general idea behind the model declaratory action?

Consumers who want to assert alleged claims against a company without Since November 1, 2018, you can try to litigate yourself with the new model declaratory action. In front of the court, consumer protection associations appear as plaintiffs on behalf of the complaining persons. The model declaratory action is mainly intended for cases in which consumers are disadvantaged, but where a lawsuit is not worthwhile because the damage amount is too low. This is the case, for example, with low but unjustifiably charged fees.

Which associations are entitled to sue?

According to the new legal regulation, only certain associations are entitled to sue. The prerequisites are that the association in question has at least 350 members and has been on the list of associations that are allowed to file injunctions for at least four years. An association authorized in this way must collect the complaints of at least ten citizens and deal with them in detail - only then can it file a lawsuit in court. Within two months, at least 50 consumers must then register their complaint in a complaint register set up by the court. If these requirements are not met, it is impossible to bring a model declaratory action. If the action is possible and successful, the defendant could be sentenced to pay damages. Damage and its cause could also be determined, which gives the consumer the opportunity to enforce his claims in a separate procedure in a simplified manner.

What is the difference to US class actions?

With The German model declaratory action cannot be compared to the class actions in the USA, especially since German judges have so far been skeptical of the 'class action' legal remedy, which is rarely used in this country. In the USA, horrific compensation payments are also intended as a penalty, while in Germany only verifiable damage should be compensated.

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