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Judge Approves VW's $14.7 Billion Settlement Over Emissions Scandal

Volkswagen logos are visible at a dealership in Los Angeles on June 28. Volkswagen has agreed to pay out $14.7 billion in a settlement with U.S. authorities and car owners over its emissions-test-cheating diesel-powered cars. The settlement was approved on Tuesday.

A federal judge has approved Volkswagen's $14.7 billion settlement over the carmaker's vehicle emissions scandal. The process of compensating affected U.S. car owners is beginning now, with the first buybacks expected to happen within the next few weeks.

Under the terms of the deal, Volkswagen agrees to either buy back or repair vehicles involved in the scandal. That means paying as much as $10.033 billion to owners. In addition, the carmaker has come to an agreement with the United States under which it will pay nearly $5 billion in environmental remediation.

The tentative deal was announced in June. On Tuesday, it was approved by U.S. District Judge Charles Breyer, who found it was "fair, adequate, and reasonable."

It's the largest civil settlement in automaker history, and the largest false advertising case the Federal Trade Commission has ever seen.

Under the terms of the agreement, the court notes, funds to compensate owners have to be made available within 10 days of this final approval, and the buyback program must begin immediately.

Volkswagen says the claims process for arranging buybacks or modifications has already started. Documents already submitted by owners are being reviewed, according to the settlement website, and once approved, buybacks or repairs will be scheduled within 90 days.

A spokeswoman for the carmaker says the company expects the first transactions to take place around mid-November.

Affected owners have until Sept. 1, 2018, to submit a claim.

The cars in question were sold as being "green" diesel vehicles with low emissions, but in fact had been set up to drive differently during emissions tests — so they appeared to have lower emissions than they really had.

As we previously reported, the emissions scandal involves some Volkswagen, Audi and Porsche vehicles, in both 2.0- and 3.0-liter diesel engine sizes, that were released from 2009 to 2016.

This settlement covers only 2.0-liter engines in VW and Audi cars owned in the U.S. Legal proceedings on behalf of owners of 3.0-liter engines are ongoing, according to the lead counsel in the case.

VW faces a number of other legal challenges related to the emissions-cheating debacle.

There are lawsuits against the German carmaker in other countries; in the U.S., there remains a possibility of criminal charges.

Meanwhile, several states have filed lawsuits accusing VW of violating state environmental laws by cheating on emissions tests, and this summer the company announced a proposed settlement with dealers who claim losses caused by the scandal.

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