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Crime The Courts Transportation United States

Legal Loophole Offers Volkswagen Criminal Immunity 323

An anonymous reader writes: According to the Wall Street Journal (paywalled) a loophole in the 1970 Clean Air Act could make it impossible for U.S. prosecutors to subject Volkswagen to criminal charges over its use of standards-dodging 'defeat devices' in its emissions-testing software. Prosecutors are now reported to be considering alternative methods, including (considerably lesser) charges that Volkswagen lied to regulation authorities.
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Legal Loophole Offers Volkswagen Criminal Immunity

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  • Well... (Score:3, Insightful)

    by MightyMartian ( 840721 ) on Wednesday September 30, 2015 @07:10PM (#50632159) Journal

    So long as the evil sociopaths who run the company are able to evade any meaningful censure, all is well! Doubtless some simpering worthless patsies will be found to take the blame while the real instigators are not only allowed to go free, but doubtless profit immeasurably.

    • Re:Well... (Score:4, Informative)

      by tnk1 ( 899206 ) on Wednesday September 30, 2015 @08:24PM (#50632539)

      Well it already got the CEO of the company to resign. I'm sure he's rich and not going to lose much, but he presumably didn't want to be forced to resign and go into retirement.

      I suppose worse could have been done to him, but its hard to say that this had zero effect on upper management.

      • Re:Well... (Score:5, Insightful)

        by Anonymous Coward on Wednesday September 30, 2015 @09:50PM (#50632899)

        I heard he's getting a $32M pension. Poor guy, they sure made an example out of him.

        • Re:Well... (Score:4, Insightful)

          by zazzel ( 98233 ) on Thursday October 01, 2015 @02:45AM (#50633629)

          I wonder if anyone dares to put this into perspective - i.e. in a comparison with Wall Street practices. Last time I heard, bonuses and pensions over there were at least one order of magnitude higher, and deaths (like suicides) following crises like Lehman Brothers and their followers were actually countable, not dubious statistical numbers.

          Also, Mr Winterkorn is still facing charges in Germany, which could lead to his imprisonment (large-scale fraud). I haven't heard from many bankers going to jail.

        • Not yet, but he is charged with fraud and might serve jail time one day. Germany is corrupt, but wonders happen sometimes (Hoeness, Middelhoff, Janssen).

        • by Tom ( 822 )

          That's why we have jail, because making him pay a few millions in fines would be little more than a "oh fuck, there goes my second yacht" moment. But if he spends his retirement years behind bars, that pension won't do him much good.

  • TFA, TFS (Score:5, Informative)

    by war4peace ( 1628283 ) on Wednesday September 30, 2015 @07:11PM (#50632167)

    None of which explain what exactly is the loophole.
    "There's a loophole there" - is all I could get. the WSJ article is paywalled.
    Any ideas? IANAL so, to me, it's a mystery.

    • Re: (Score:3, Informative)

      None of which explain what exactly is the loophole. "There's a loophole there" - is all I could get. the WSJ article is paywalled. Any ideas? IANAL so, to me, it's a mystery.

      Yeah, basically "the clause in the act indemnifies car manufacturers against criminal penalties". A non-paywalled linked with a bit more info: http://www.wsj.com/articles/vo... [wsj.com]

    • Re: (Score:3, Informative)

      by Turnerj ( 2478588 )

      Speaking of loopholes and the WSJ paywall, you can actually get around it by Googling part of the URL.

      This is the WSJ URL: http://www.wsj.com/articles/vo... [wsj.com]
      Google this: volkswagen-may-not-face-environmental-criminal-charges

      Then just click the first link for WSJ. I assume they are blindly checking the referrer. I have tried this on various other news sites that paywall with success.

      I briefly read the article though, nothing particularly useful.

      • by Junta ( 36770 )

        I assume they are blindly checking the referrer.

        I think it's not a matter of blindly allowing, IIRC google explictly said they would block any site that does not actually give the user the content that appeared in the search results. So a lot of news sites had to allow google referalls or else not show up in results. Also experts exchange had to start showing their answers (amusingly they would have at the top of the page a redacted 'pay to reveal answer' or something, but right underneath the answer was in the clear because of the google thing.

      • fwiw, that trick did not work for me. I have cookies turned off and lots of blockers active. nice try though.

      • Why play their game? Just pretend they don't exist and get on with your life.

    • Re:TFA, TFS (Score:5, Informative)

      by squiggleslash ( 241428 ) on Wednesday September 30, 2015 @07:43PM (#50632343) Homepage Journal

      It's not really a loophole. Instead it was a conscious decision about how to enforce the Clean Air Act by the lawmakers who made it. They felt that criminal prosecutions would be hard to win, so opted to use the civil lawsuit system instead.


      Former Rep. John Dingell (D., Mich.), a longtime congressman and auto industry ally who helped pass the Clean Air Act, said in an interview that the law focused on civil penalties because theyâ(TM)re easier to enforce. âoeItâ(TM)s easier, speedier, quicker,â he said. Mr. Dingell predicted Volkswagen will face billions of dollars in costs regardless. âoeThe cost to Volkswagen is going to be unbelievable,â he said. Volkswagen has set aside $7.3 billion to cover the fallout from the emissions scandal. âoeThe risk of them going out of business is very real.â

      I'm sure many people read the headline and assumed it meant VW is off the hook. It isn't. It's just no VW executives, or for that matter software developers, will be going to jail. VW will, however, be paying absolutely massive fines. Which is probably what you expected anyway.

      • If by "absolutely massive" you mean "so small they can be considered an operating cost" then sure.

        • No, it's going to be a massive fine. They've already set aside over $7 billion for recalls and repairs over this. 2014 profit for VW was nearly EUR 11 billion. This is enough to hurt already. And that's before fines and penalties. Then count in the huge drop in stock price. US fines alone could get up to $18 billion. This goes way beyond operating costs.

        • Fines don't work. No one is willing to enforce an economic penalty that would endanger the future of a big company. It's considered to be too disruptive.

          When this is combined with no effective personal responsibilities then nothing changes. No matter how badly management screws up at a big company, they always retire rich. There is no down side to breaking the law, because the chances of getting caught are non-existent and the penalty is getting to keep all the wealth gained by breaking the law,

          Want proof

      • by mysidia ( 191772 )

        It's just no VW executives, or for that matter software developers, will be going to jail.

        Sure about that?

        How about they charge them with XX million counts of fraud, instead of focusing on clean-air act in particular.. and the damages are whatever it costs to remedy by replacing or fixing all units and remediate / clean up pollutants released as a result of fraud? Systemic and automatic wire fraud, since it involves crafting digital systems to intentionally cause customers' vehicles to produce falsi

        • by lgw ( 121541 )

          What fraud? The car performed as advertised, right? Got the advertised MPG and 0-60 times and whatnot, or at least as much as any car ever does.

          • Re:TFA, TFS (Score:5, Informative)

            by swright ( 202401 ) on Wednesday September 30, 2015 @08:15PM (#50632501) Homepage

            What fraud? The car performed as advertised, right?

            Actually it didn't. Emissions are part of advertised specs. In the UK at least, this is an important figure because it determines how much annual road tax you have to pay to drive the thing - i.e. its important to consumers making the decision....and its really important to the UK government who have arguably been defrauded out of a whole bunch of tax revenue.

            • by lgw ( 121541 )

              Ah, that makes sense then for the UK. Did VW do the same there? (I strongly suspect every German brand is doing the same thing in the US, but there's less reason to cheat elsewhere).

              • I strongly suspect every German brand is doing the same thing in the US...

                You know, Mercedes doesn't really sell many of their diesel passenger cars in the US like they do in Europe. I suspect the obstacle is the stringent EPA regulations limiting their ability to deliver a vehicle in the US with compelling gas mileage AND performance.

                Mercedes management needs to be scrutinized by shareholders right now. While Volkswagen has been selling dozens of thousands of diesel vehicles in the US, Mercedes managem

            • by AK Marc ( 707885 )
              This is about the US, and emissions are not an advertised spec, though I've seen some push to put CO2 on the label, but this was about NOx, which I've not seen anyone ever advertise.
              • by tlhIngan ( 30335 )

                This is about the US, and emissions are not an advertised spec, though I've seen some push to put CO2 on the label, but this was about NOx, which I've not seen anyone ever advertise.

                No, but they're advertised as "Clean" vehicles. Sure the meaning is vague and fuzzy, but the whole intention is for consumers to believe the VW cars they were buying were better for the environment if they chose the diesel option.

                The fact that under normal operations they emitted more than legal limits would mean that they are n

              • by adolf ( 21054 )

                Emissions don't matter when it comes to the consumer end of such a fraud.

                In the US, cars are certainly advertised as having certain efficiency and power ratings (normally expressed in terms of miles-per-gallon, brake horsepower, and torque in foot-pounds).

                If the forced software upgrade happens (where "forced" means: if your car happens to be within twenty feet of a service bay and finds itself unattended for more than 3.2 minutes, it gets upgraded), which it will, these numbers are likely to change.

                These r

          • I think there is an expectation that a new car pass emissions test without cheating, especially one that is advertised being cleaner than typical cars.

      • Re:TFA, TFS (Score:4, Interesting)

        by gstoddart ( 321705 ) on Wednesday September 30, 2015 @08:10PM (#50632483) Homepage

        It's not really a loophole. Instead it was a conscious decision about how to enforce the Clean Air Act by the lawmakers who made it.

        Come now, do you think those lawmakers made such a helpful clause without a couple of campaign contributions to grease the wheels? Sorry, but when laws are written like that, you can safely assume it's because someone wanted it that way.

        For the exact reason the DMCA has no fangs when corporations misuse it; because they bloody well wanted it that way.

        In fact, it would appear Former Rep. John Dingell (D., Mich.), a longtime congressman and auto industry ally gave them exactly what they wanted.

        And, once again, corporations buy the laws that suit them best.

      • Re:TFA, TFS (Score:5, Insightful)

        by c ( 8461 ) <beauregardcp@gmail.com> on Wednesday September 30, 2015 @08:21PM (#50632521)

        It's just no VW executives, or for that matter software developers, will be going to jail.

        ... in the USA.

        • by Tom ( 822 )

          This. Germany (home of VW) has already opened a criminal investigation against the former CEO, so maybe /. could step out of its US-centric world-view for a moment, especially when reporting about a foreign company?

      • by pz ( 113803 )

        The risk of them going out of business is very real.

        I say this someone who has owned original Bugs, Rabbits (including a GTI!), and, after a long absence from VW-ownership currently own a 2009 Jetta that is not affected by the emission issues: it would be a far greater loss to society as a whole for VW to pay such a large fine that it goes out of business than for a compromise to be reached that allows it to continue to produce absolutely great gasoline-powered cars, and continue to contribute in a very positive way to Germany's economic engine.

        Yes, VW likel

        • Here, in California, I am sure the Governor would not shed one tear if ALL car manufacturers went out of business.
          • He would prefer everyone biked everywhere, even if it meant millions of people starve to death due to lack of transportation infrastructure.
        • It's not black and white. VW could go under, be forced to sell the company to new owners, who may or may not decide to keep the VW workers and name. In the end it's possible that all the same workers are still making good cars, but just with new owners and new management. It might even still be called VW.

          VW makes fantastic cars. Punishing the company so deeply that we lose VW, and Audi, and Porsche to boot? To what end? Who is going to benefit, other than lawyers?

          A lot of people profited from VW while it was cheating. It seems only fair that those profits be used to restore those who were defrauded. It seems the best outcome would be to cut the head off VW and

        • I agree that VW should not be punished to the extent that they go out of business. They should, however, be punished to a degree that is proportional to the willful disregard of the rules and regulations by which they're supposed to be bound. It's this notion of intentional and blatant cheating, I think, that everyone is so upset about, not the actual damages incurred, which, honestly, are probably minimal.

          Note that you can draw some interesting comparisons over the $900 million in fines and millions of v

      • So prosecute as fraud, without bringing the clean air act into it?

      • Germany is starting a criminal investigation of the former CEO : http://www.wsj.com/articles/ge... [wsj.com]

        They might be protected in teh US, but german politician and other german firms are hating right now to be associated with cheaters. Germany is a big exporting country. And VW is making them look very very bad. I am just guessing and a bit making a CT here but I would say the german prosecutor WILL have carte blanche to investigate this thoroughly and show the world they will not stand for it. Thus protectin
    • There's always the standard "Laws are for the little people" loophole. And if that fails, you can always pull out "It was the underling's fault."

  • by XanC ( 644172 ) on Wednesday September 30, 2015 @07:16PM (#50632199)

    If the rulebook says "When we plug in our testing machine, your car needs to be emitting X, Y and Z", then they were totally within the rules.

    • Re: (Score:3, Insightful)

      by Anonymous Coward

      No defeat devices. They violated that rule by having a mode specifically for the testing environment that defeated the testing of emissions during normal operation.

  • It would have been more helpful if the summary had at least... you know... summarized what loophole actually was.
  • by RichMan ( 8097 ) on Wednesday September 30, 2015 @07:27PM (#50632259)

    Beyond the emissions stuff what about their claims to the public?

    Mileage. Emissions. All those consumers have valid legal claims that they were lied to. Regardless of cheating the emissions test, the consumers were told something that it turns out VW knew was a complete lie.

    • by jafac ( 1449 )

      Civil Fraud.

      No jail. And corporate bankruptcy can get them out of paying fines.

  • by turkeydance ( 1266624 ) on Wednesday September 30, 2015 @07:28PM (#50632263)
    part of the deal to get the CAA passed was to eliminate criminal consequences for the car manufacturers. it was ALREADY known.
  • I knew that bull would never happen...

    • by tnk1 ( 899206 )

      They're still on the hook for civil penalties. It may or may not be $18B, but this wasn't about the fines, it was about the jail time. Although how they were planning to imprison German nationals is still beyond me.

  • I'll bet l that California and the dozen or so other CARB states could still prosecute. At minimum they could change the smog test methodogy to defeat the defeat so that the cars cannot get a smog cert and could not be registered. This would open the door to civil suits for sure.

  • Who wrote the software and who told him to write the software?
  • This is terrible (Score:5, Insightful)

    by Jiro ( 131519 ) on Wednesday September 30, 2015 @08:46PM (#50632653)

    And not because it lets the car companies get away with something.

    The prosecutor is considering prosecuting Volkswagen for "lying to the authorities". "They lied to the authorities" is a catchall crime that the government often brings when it finds itself unable to convict someone for an actual crime. This is a bad, bad, thing because you can't just refuse to speak to the government, and pretty much anyone is going to say something when questioned by the government that can be spun as a "lie", even if they just forgot, were misheard, or told an actual lie but one that has no bearing on the case.

    The people cheering for this are really cheering for the idea that the government can put anyone in jail at a whim, because that's what the crime of "lying to the government" amounts to. It makes a mockery of the idea of a fair trial, and the fact that in this case the government decided to use this trick on a deserving target doesn't make it any less horrible.

  • by Snotnose ( 212196 ) on Wednesday September 30, 2015 @09:08PM (#50632727)
    The assumption is you bought it because of it's pep and mileage. VW "fixes" the problem, both take a huge hit. Do you still want the car? Will VW buy it back? How about resale value? The Kelly Blue Book value just took a huge hit as the pep and mileage went way down. Who pays for that?

    I for one am glad I didn't buy a diesel car in the last 10 years, sounds like a nightmare for those who did.
  • who didn't see this one coming?

  • I'm not a lawyer (Score:4, Informative)

    by viperidaenz ( 2515578 ) on Wednesday September 30, 2015 @11:09PM (#50633209)

    But section 203(a)3(B) of the Clear Air Act is the one that mentions defeat devices.

    and the punishment for violating that,

    SEC. 205. CIVIL PENALTIES. .....
    any person who violates section
    203(a)(3)(B) shall be subject to a civil penalty of not more than

    No criminal charges, only $2,500 per car.

  • Not pretty, or elegant or sensible, let alone honourable what VW did. I wish for a better environment. VW sort of cheated and I'm not happy about it.

    In a legal sense however VW committed crimes when and if they acted against the law. We know that law and common sense do not always coincide.

    The questions I have not seen yet are to establish whether case will actually stick. Was it unlawful of VW to rig the tests the way they did? Did laws make make provisions for such rigging? Or did the law provide tes

"The eleventh commandment was `Thou Shalt Compute' or `Thou Shalt Not Compute' -- I forget which." -- Epigrams in Programming, ACM SIGPLAN Sept. 1982