VW agrees to settle Audi CVT class-action case in U.S. court
A federal judge has granted preliminary approval for the settlement of a class-action suit against Volkswagen Group of America over alleged defects with continuously variable transmissions in about 64,000 2002-06 Audi A4 and A6 models.
The original lawsuit -- which concerned only U.S. customers -- argued that manufacturing and design problems caused the transmissions to fail and left owners stuck with repair costs. The suit also alleged that Audi was aware of the problems and hid them from consumers.
In the settlement, Audi, the luxury unit of Volkswagen AG, denied the allegations. The automaker said in court documents that it maintains that "the CVT transmissions of settlement class vehicles were not defective," that no applicable warranties or statutes were breached or violated and that the vehicles "were properly designed, manufactured, distributed, marketed, advertised, warranted and sold."
The original lawsuit was filed in January 2011, according to The New York Times, which reported the story on Tuesday. The preliminary settlement approval was given by U.S. District Court Judge A. Howard Matz in Los Angeles.
The Times reported that Audi said it settled the case because it was "'mindful of the fact that future protracted litigation, with the burdens and uncertainties it creates, may not be in the best interests of their customers.'"
An Audi spokesman declined to comment further.
Another court hearing is set for September to take up potential complaints with the settlement.
According to court documents, terms of the settlement include:
Audi drivers with certain CVT repairs occurring within 10 years or 100,000 miles, whichever occurred first, of the original sale or lease of the vehicle are entitled to reimbursement. The initial powertrain coverage was 4 years/50,000 miles. Parts for reimbursement vary by model year.
The transmission control module is covered for 2003-06 A4 and A6 models. The valve body is covered for 2003-04 A4 and A6 models. Replacement of the transmission without the valve body and transmission control module is covered for 2002-04 model years, as well. It is not indicated in the settlement if owners would be reimbursed if another transmission part failed or needs replacement.
Owners with certain 2002 and 2003 models beyond the extended warranty can still be reimbursed for the specified repair if the issue occurred within 100,000 miles or 10 years.
The settlement also includes a trade-in reimbursement cost for lost value of a 2002-04 A4 or A6 needing a replacement CVT after the normal warranty expired but the vehicle was sold or traded with no repair. There were no details on why 2005-06 models are not covered.
Excluded from the settlement is anyone claiming personal injury, property damage or subrogation.
The plaintiff lawyers involved in the settlement will receive about $2.4 million for fees and expenses.