In a reply brief filed in the Ninth Circuit, CCL joined co-counsel in arguing that the district court misunderstood federal and state law in eliminating one cause of action, limiting evidence, and reducing punitive damages in bellwether cases that opted out of the global settlement of the Volkswagen emissions scandal.
For a nine-year period of time, Volkswagen employed a "defeat device" in certain cars sold as "green" vehicles that tricked emissions tests into registering low carbon emissions rates when the cars actually emitted 36 times the permissible levels of pollution. Buyers who purchased the cars across the United States sued over the misrepresentations. Volkswagen, which pleaded guilty to charges emanating from the scandal in both the U.S. and in Europe, settled with most buyers in a multi-district litigation heard in federal court in San Francisco.
Nine purchasers who opted out of the settlement chose to try their cases. Under the terms of the joint trial, VW admitted liability but challenged the claimed damages. The purchasers brought several causes of action, including claims under California's lemon law and its consumer-protection law. However, the court treated the settlement offer made prior to the lawsuits as a bona fide attempt to settle the claims, throwing out the consumer-protection cause of action. The reply brief asserts that this was error because the settlement did not qualify as an offer under the law and included a waiver of other claims, which is inconsistent with California precedent. The court also ruled the cars fit for driving, even though the California statute has more rigorous requirements, including one that bars mislabeling the vehicles.
Four of the plaintiffs won jury verdicts of $25,000 each in punitive damages. The court reduced those verdicts to a 4:1 ratio, putting each punitive-damage award under $10,000. The reply brief argued that this misconstrued Supreme Court precedent that has rejected mandatory ratios and permits higher punitive damages when the compensatory damages are small.
The case is due to be argued December 10.
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