VW appeals emissions fraud fines

Volkswagen Korea is appealing the South Korean watchdog’s decision to slap it with 37.3 billion won ($32.7 million) in fines and a correction order for false advertising related to its diesel emissions scandal.

Volkswagen filed an administrative suit with the Seoul High Court on Feb. 23 against the FTC’s ruling, which was imposed late last year. It did not file an injunction, the court said Wednesday.

The company reportedly claims that the watchdog’s fine and correction order are unfair.

The commission had ordered a 37.3 billion won fine against the local branch of the German automaker last December, marking the largest penalty ever imposed by the watchdog for false advertising.

According to the FTC, Volkswagen advertised that its models met strict European emission standards, stressing that the company’s diesel vehicles were both environmentally friendly and highly energy efficient. 

Aside from the fine, the FTC also filed criminal charges against Audi Volkswagen Korea, Volkswagen Group and five former and current senior officers of the German automaker and ordered that the companies offer a public correction of their false-advertising misconduct.

Last month, VW began its first set of recalls of roughly 126,000 vehicles fitted with emissions-rigging software. However, despite the government’s approval of the carmaker’s recall measures, thousands of local customers have filed suits against the company seeking further compensation.

The law firm of Barun Law LLC, leading multiple suits in both Korea and the US, stated that it currently represents around 5,000 local consumers filing suits against VW.

The first set of hearings regarding Volkswagen’s customer compensation was held at the Seoul Central District Court last Friday, where a total of 259 local plaintiffs demanded the German automaker offer full refunds of their vehicles.

Despite plaintiffs rejecting the company’s recall measures, VW argued that as the recall process began last month, customers should be given more time to make their decision. The next hearing is scheduled to be held on June 13.

By Julie Jackson (juliejackson@heraldcorp.com)