Mercedes to pay more than $2 billion to settle “clean diesel” claims, $700 million goes to consumers

Seeger Weiss is pleased to announce the details of a $700 million settlement reached on behalf of current and former owners and lessees to resolve the consumer class action suit In re. Mercedes-Benz Emissions Litigation. Pending approval by the U.S. District Court of New Jersey, it will provide $3,290 or more for current and $822.50 for former owners and lessees of eligible vehicles.

“We’re proud to have reached a settlement that both compensates consumers who paid a premium to buy what they thought were environmentally-friendly cars, and ensures their vehicles are repaired free of charge. This is a big win for consumers and for the environment,” said Seeger Weiss LLP co-founding partner, Christopher A. Seeger, who represents plaintiffs in the class action litigation. Seeger, as well as partners Christopher Ayers, David R. Buchanan, Shauna Itri, and Jennifer Scullion, associates Kseniya Lezhnev and David R. Tawil, and paralegals Scott Siegel and Sabrina Tyjer served a key role in the nationwide plaintiffs’ team.

German automaker Daimler—parent company of Mercedes-Benz—first announced it would pay over $2 billion in settlements to resolve civil and environmental claims that the manufacturer installed software in their cars to cheat emissions tests on August 13, 2020. Of that total, $1.5 billion represents a settlement with various U.S. authorities: the U.S. Environmental Protection Agency, the California Air Resources Board, the Department of Justice, the California Attorney General’s Office, and U.S. Customs and Border Protection.

The remaining $700 million resolves the consumer class action litigation now pending before the U.S. District Court for the District of New Jersey. That litigation addressed an estimated 250,000 Mercedes-Benz diesel passenger cars and Sprinter vans sold in the U.S between 2009 and 2016 that used emissions cheating software. Those vehicles include:

The settlement guarantees free installation of Approved Emissions Modifications (AEMs) in affected vehicles. Installation comes with an extended modification warranty that covers any unforeseen effects due to an AEM, such as changes to a vehicle’s fuel economy, horsepower, torque. Should the installation of an AEM take more than three hours to complete, transportation costs may also be provided. Additional payment may be possible if an AEM is not available by October 2022. For more details about AEMs and extended modification warranties, visit bluetecupdate.mbusa.com.

The settlement also compensates current and former owners of affected vehicles for the diesel emissions deficiencies. Current owners can receive up to $3,290 if no former owner or lessee submits a claim for the same vehicle. If both current and former owners or lessees file a claim for the same vehicle, the current owner or lessee receives $2,467.50 and $822.50 is divided equally among former owners or lessees. Eligible current owners and lessees must have the AEM installed and submit a claim by October 1, 2022 to receive money. Eligible former owners and lessees must complete a claim by the later of 75 days after date of notice, or after the date the court approves the settlement. For more details on the In re. Mercedes-Benz Emissions Litigation settlement, visit mbluetecsettlement.com.

The class action suit—led by lead counsel for the plaintiffs James E. Cecchi of Carella, Byrne, Cecchi, Olstein, Brody, & Agnello, P.C., and Steve W. Berman and Sean R. Matt of Hagens Berman Sobol Shapiro LLP—also names Germany technology company Robert Bosch as a defendant. The suit alleges that Bosch played a key role in developing the illegal defeat device and in implementing the Mercedes emission strategy. The plaintiffs’ claims against Bosch are not resolved by the proposed settlement with Daimler.

Much of the groundwork for this case was laid by an earlier suit against Volkswagen, which affected roughly 600,000 diesel passenger cars, and ultimately resulted in a settlement totaling more than $20 billion in 2017. The largest consumer auto industry class action settlement in U.S. history, it provided more than $10 billion for affected consumers plus an additional $4.7 billion to remediate environmental damaged caused by the so-called “clean diesel” vehicles. Seeger, as a member of that litigation’s plaintiffs’ steering committee, helped negotiate the historic settlement. As in the current litigation, Bosch was alleged to have provided VW with the technology that allowed their cars to cheat on diesel emissions tests.