Maryland Secures Millions in Emissions Fraud Settlement with Mercedes-Benz

Maryland is set to receive over $6.7 million as part of a significant multistate settlement totaling nearly $150 million with Mercedes-Benz USA and Daimler AG. The agreement resolves allegations that the automotive companies engaged in emissions fraud by equipping diesel vehicles with illegal “defeat devices.” These devices allowed vehicles to appear compliant with emissions standards during testing while emitting harmful levels of Nitrogen Oxides (NOx) in excess of legal limits during normal operation. The settlement, announced by Maryland Attorney General Anthony G. Brown, aims to hold the companies accountable for misleading consumers and contributing to air pollution.

The investigation, co-led by Attorney General Brown on behalf of Maryland’s Consumer Protection Division and the Maryland Department of the Environment, found that Mercedes-Benz USA and Daimler AG violated consumer protection and environmental laws. The companies are accused of marketing and selling diesel vehicles equipped with undisclosed defeat devices that circumvented emissions regulations. These devices were reportedly installed in approximately 211,000 model year 2008-2016 diesel passenger cars and vans sold across the United States, including in Maryland. The NOx pollutants emitted are known to cause respiratory illnesses and contribute to the formation of smog, impacting air quality and public health. The lawsuit further alleges that Mercedes-Benz concealed the existence of these devices from regulators and the public, while simultaneously promoting the vehicles as environmentally friendly.

As part of the settlement, Mercedes-Benz USA and Daimler AG will pay a total of $120 million to the 50 participating jurisdictions. Maryland’s share of this initial payment is $6,737,163. An additional sum of up to $29,673,750 may be distributed to the states, contingent on the number of vehicles repaired to meet existing state emissions standards. Beyond these financial penalties, the settlement mandates a consumer relief program for an estimated 39,565 vehicles nationwide that, as of August 1, 2023, had not been repaired or removed from service. Approximately 4,000 of these affected vehicles were in Maryland as of 2020.

Under the terms of the agreement, Mercedes-Benz will be required to install approved emission modification software on these affected vehicles. Consumers will also receive an extended warranty and a direct payment of $2,000 for each impacted vehicle. The company is further obligated to adhere to stricter reporting requirements and implement reforms to prevent future deceptive practices, including a prohibition on misrepresenting emissions compliance in the marketing and sale of diesel vehicles. The multistate effort was led by the attorneys general of Maryland, Connecticut, and Delaware, with a steering committee including Georgia, New Jersey, New York, South Carolina, and Texas, and participation from numerous other states and the District of Columbia.

This settlement means that approximately 4,000 Maryland vehicle owners may benefit from direct payments, extended warranties, and necessary repairs to their diesel vehicles, addressing the environmental concerns and potential health impacts associated with excess NOx emissions. For residents in Maryland, this outcome signifies a commitment to enforcing environmental regulations and protecting consumers from deceptive practices, ensuring that vehicles on the road meet established air quality standards.

Article by Mel Anara, based upon information from the Maryland Attorney General’s Office.

---