Mercedes-Benz USA and Daimler AG have settled for nearly $150 million over emissions cheating allegations involving their diesel vehicles. The settlement was announced by Attorney General Schwalb who, alongside a coalition of attorneys general from across 50 states, reached the agreement following claims that the auto giant had used software to cheat emissions testing. According to the Office of the Attorney General for the District of Columbia, the implicated vehicles, numbering more than 200,000 nationwide, emitted pollutants that far exceeded legal limits.
The states contended that Mercedes intentionally designed and utilized defeat devices in their cars and vans between 2008 and 2016. These devices were engineered to temporarily reduce emissions during testing phases, thus creating false compliance with environmental standards. The illegal software allowed the affected vehicles to release, during normal operation, amounts of nitrogen oxides (NOx)—pollutants linked to respiratory issues and smog—far beyond what is legally permitted. In a statement obtained by the Attorney General's press release, Schwalb made it clear that such deceptive practices and the resultant environmental harm are intolerable.
Under the terms of the multistate settlement, Mercedes will not only pay a hefty immediate fine of $120 million to the states, with an additional $29,673,750 suspended pending the execution of a consumer relief program, but also take corrective action. An estimated 39,565 vehicles that have not undergone proper modification or removal from circulation in the U.S. are expected to be remedied. Moreover, the company is to extend warranties and provide $2,000 in restitution per vehicle to the affected consumers who get Mercedes-approved emission modification software installed. The full details of the fines, vehicle repairs, and restitution payments are outlined in the settlement agreement.
Mercedes' wrongdoing involved deceitful marketing practices, whereby they falsely advertised their diesel vehicles as "environmentally-friendly" while circumventing DC and federal emissions standards. "My office will not allow companies to profit by cheating the system, lying to consumers, or polluting our environment," Attorney General Schwalb made clear, signaling the robust nature of the joint investigation that led to the settlement. This particular case follows in the wake of similar resolutions with Volkswagen, Fiat Chrysler, and Robert Bosch GmbH, the latter responsible for developing the defeat devices, which previously settled for $570 million, $72.5 million, and $98.7 million respectively with the States, according to the same press release.
In light of the settlement, Mercedes is mandated to comply with numerous conditions focused on transparency and compliance moving forward. The resolution aims to prevent any future deceptive marketing and sale of diesel vehicles, ensuring they meet emissions and compliance standards. The company will also be subject to stringent reporting requirements and reforms to their practices. The District’s complaint, filed in DC Superior Court can be viewed alongside the multistate agreement on the Attorney General's website, showcasing a public effort to hold the automaker accountable for its significant legal and moral breaches.
