Newspaper article Charleston Gazette Mail

VW, US in Talks to Start Pollution Remediation Funds

Newspaper article Charleston Gazette Mail

VW, US in Talks to Start Pollution Remediation Funds

Article excerpt

Volkswagen is in talks with U.S. authorities to establish a national remediation fund and a separate one for California as punishment for pollution from its cars after the automaker cheated on diesel-emissions tests, said people familiar with the matter.

One fund would be administered by the Environmental Protection Agency and used to promote clean transportation throughout the United States; the other would be run by California to promote zero- emission vehicles in the state, said the people, who asked not to be identified because the talks are private. Negotiations are continuing and many details are in flux, the people said.

A deal would help settle a Department of Justice civil lawsuit and clear a key obstacle as the German automaker tries to emerge from a scandal affecting 11 million of its vehicles worldwide. Volkswagen, which faces billions of dollars in regulatory fines and legal compensation, has a March 24 court deadline in California to present a solution for nearly 600,000 U.S. cars whose diesel engines were rigged to pass emissions tests while polluting more than allowed.

Representatives for VW, the EPA, the Department of Justice and the California Air Resources Board declined to comment on the details of the negotiations.

On Jan. 4, the Justice Department sued Volkswagen for violating the Clean Air Act. U.S. District Judge Charles Breyer, who is presiding over the case, has ordered the company to produce a solution at next week's court date in San Francisco. Penalties for the four violations could total as much as $46 billion, according to Bloomberg Intelligence analyst Kevin Tynan, prompting the need to negotiate a deal that would be manageable.

A U.S. settlement would add to the 6.7 billion euros ($7.4 billion) that VW has set aside for the scandal, including repairing 8.5 million vehicles in Europe.

The Justice Department's process is similar to its civil suit against BP after the 2010 Deepwater Horizon offshore oil spill, a department official who asked not to be cited by name because of the active litigation has said. In BP, the U.S. coordinated its case with those by private plaintiffs. The government has linked its case against Volkswagen with consumer suits and those filed by several state attorneys general that are now before Breyer. …

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