VW sued by U.S. in diesel emissions scandal

WASHINGTON -- The Justice Department challenged the German automaker Volkswagen in federal court Monday, saying that the company installed illegal devices in nearly 600,000 diesel engine systems to impair emissions controls, that way increasing harmful air pollution.

But at least for now, federal prosecutors have stopped short of criminal charges and did not single out individual executives.

The civil complaint, filed in Detroit, comes after Volkswagen admitted in September that it had installed software designed to cheat on emissions tests in 11 million diesel vehicles worldwide, setting off one of the largest corporate scandals in the auto industry's history.

Since then, the company's chief executive officer, Martin Winterkorn, has resigned, nine employees have been suspended, and the company has begun the twin tasks of designing fixes for the vehicles and containing consumer outrage and litigation.

Regulators across the globe, including in India, South Korea and Germany, are conducting investigations, as are attorneys general in all 50 states. The Justice Department has been seen as the only agency that might hold executives personally accountable.

"With today's filing, we take an important step to protect public health by seeking to hold Volkswagen accountable for any unlawful air pollution, setting us on a path to resolution," said Cynthia Giles, assistant administrator for the Environmental Protection Agency's Office of Enforcement and Compliance Assurance. "So far, recall discussions with the company have not produced an acceptable way forward. These discussions will continue in parallel with the federal court action." But given the cascade of revelations, the civil complaint is something of a blow to the Obama administration's highly promoted new strategy for getting tough on corporate crime. The Justice Department has gained a reputation in recent years for forcing companies to pay big fines, while sparing the executives involved. In September, Deputy Attorney General Sally Q. Yates said that impression had weakened public confidence and vowed to change it.

"Corporations can only commit crimes through flesh-and-blood people," Yates said as she announced the new policy, which encouraged prosecutors to set their sights on prosecuting corporate executives from the beginning of investigations.

Two weeks later, the Justice Department opened its investigation into Volkswagen.

This story was originally published January 4, 2016 at 5:15 PM with the headline "VW sued by U.S. in diesel emissions scandal ."