Jessica Karmasek Dec. 9, 2015, 2:22pm


WASHINGTON (Legal Newsline) - More than 450 class action lawsuits filed against Volkswagen over its emissions scandal will be consolidated in a California federal court.

The U.S. Judicial Panel on Multidistrict Litigation issued a transfer order Tuesday.

The four-member panel selected the U.S. District Court for the Northern District of California to handle the lawsuits, saying the federal court will serve “the convenience of the parties and witnesses and promote the just and efficient conduct of the litigation.”

“All actions involve common factual questions regarding the role of VW and related entities in equipping certain diesel engines with software allegedly designed to engage emissions controls only when the vehicles undergo official testing, while at other times the engines emit nitrous oxide well in excess of legal limits,” wrote Sarah S. Vance, chief judge of the U.S. District Court for the Eastern District of Louisiana and chair of the panel.

“Since the filing of the motion, hundreds of cases, mostly class actions, have been filed on behalf of, inter alia, dealers, owners and lessees of affected vehicles. Centralization will eliminate duplicative discovery, avoid inconsistent pretrial rulings (especially on issues relating to class certification), and conserve the resources of the parties, their counsel and the judiciary.”

In September, Volkswagen admitted to intentionally programming turbocharged direct injection, or TDI, diesel engines to activate certain emissions controls only during laboratory emissions testing.

Volkswagen and Audi owners began filing class actions soon after, claiming fraud and breach of contract due to expected reductions in horsepower and fuel efficiency. At least one investor lawsuit, seeking class action status, has been filed to seek compensation for the drop in stock value due to the scandal.

The MDL panel was seemingly torn in reaching its decision.

It noted in its seven-page order that the litigation is international in scope, and that the vehicles addressed by the notice of violation are “only a fraction of the estimated 11 million affected vehicles worldwide.”

“Potentially relevant witnesses and evidence from VW and other entities involved in the design, production, sale and marketing of the affected vehicles and the components at issue likely are located outside of the United States. Indeed, much of the underlying conduct at the center of plaintiffs’ claims likely occurred in Germany,” Vance wrote.

The panel said it is “convinced” that the controversy touches multiple districts across the U.S., and that the various Volkswagen entities “hold ties” to many districts.

For instance, VW Group of America and a similar division of Audi are based in the Eastern District of Virginia, where corporate executives and certain relevant documents and witnesses may be found.

New Jersey is the domestic VW affiliates’ state of incorporation and where some of its U.S. and regional operations are based.

The Eastern District of Michigan is where Environmental Protection Agency testing facilities and VW’s Engineering and Environmental Office are located and governmental investigations reportedly are occurring.

California is the state with the most affected vehicles and dealers, where significant testing of affected vehicles occurred, and the home of the California Air Resources Board, which played an important initial role in investigating and, ultimately, revealing VW’s use of the defeat devices.

Tennessee is home to a large VW manufacturing plant in Chattanooga that produced some of the affected vehicles.

“While all of these districts may yield some or even much discovery, no single district possesses a paramount factual connection to these cases,” Vance wrote for the panel. “And none of the cases now before us has advanced so far in the few months since their filing as to give any particular district unique insight or knowledge of this controversy.

“While any number of transferee districts could ably handle this litigation, we are persuaded that, in these circumstances, the Northern District of California is the appropriate transferee district for this litigation.”

The MDL panel pointed out that there are 30 actions pending in the Northern District of California, including the first-filed case in the nation, and plaintiffs have filed a total of 101 cases in the state of California -- nearly a fifth of all cases filed nationwide.

Judge Charles R. Breyer will serve as the transferee judge, according to the MDL order.

The panel said Breyer is “thoroughly familiar” with the nuances of complex, multidistrict litigation, having presided over nine MDL dockets, some of which involved numerous international defendants.

“We are confident that Judge Breyer will steer this controversy on a prudent and expeditious course,” Vance wrote.

Law firm Hagens Berman, which has filed six nationwide class action lawsuits and one California-only case against Volkswagen, said Tuesday it was “very pleased” with the court assignment.

“Our first case, which was the first case in the United States, was filed in this same court,” the firm said in a statement. “Hagens Berman has appeared and successfully litigated many cases in this court, including before Judge Breyer, whom we know to be a highly capable, experienced and fair judge.

“We have no doubt that Judge Breyer will oversee an expeditious and fair resolution of the Volkswagen Emissions litigation.”

From Legal Newsline: Reach Jessica Karmasek by email at jessica@legalnewsline.com.

Organizations in this Story

Hagens Berman Sobol Shapiro, LLP
455 N Cityfront Plaza Dr
Chicago, IL 60611

U.S. Environmental Protection Agency (EPA)
1200 Pennsylvania Ave NW
Washington, DC 20460

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