Volkswagen sued for false advertising over 'Clean Diesel' claims

A federal consumer watchdog sued Volkswagen on Tuesday, charging the company made false claims in commercials promoting its "Clean Diesel" vehicles as environmentally friendly.

The German automaker hastily pulled the ads following last year's admission it had installed illegal software on its diesel vehicles to cheat emissions tests. U.S. regulators say Volkswagen's engines spewed up to 40 times the allowed levels of air pollutants in real-world driving conditions.

• Volkswagen 'clean diesel' ads face U.S. probe
• Could Volkswagen scandal be diesel's death knell?

The Federal Trade Commission alleges that Volkswagen deceived customers during a seven-year period by selling more than 550,000 diesel cars based on fraudulent claims made through a marketing campaign. That campaign included Super Bowl ads, online social media campaigns and print advertising targeted to "environmentally conscious" consumers.

• VW's personal betrayal a sad lesson in business morality
• Volkswagen target of tax evasion probe over break for low-polluting cars

"Hybrids? They're so last year," Volkswagen proclaimed in a mailer to customers promoting its 2009 Jetta TDI. "Now going green doesn't have to feel like you're going green."

The FTC's action is the latest blow to Volkswagen, which also faces more than $20 billion in potential fines for violating U.S. clean air regulations and hundreds of class action lawsuits filed on behalf of angry customers.

Tests were rigged

"For years Volkswagen's ads touted the company's 'Clean Diesel' cars even though it now appears Volkswagen rigged the cars with devices designed to defeat emissions tests," said FTC Chairwoman Edith Ramirez. "Our lawsuit seeks compensation for the consumers who bought affected cars based on Volkswagen's deceptive and unfair practices."

In addition to the raft of civil litigation, the Justice Department and the Environmental Protection Agency is also weighing potential criminal charges against the company and senior executives.

Volkswagen Group of America spokeswoman Jeannine Ginivan said the company is reviewing the latest lawsuit and "continues to co-operate with all relevant U.S. regulators."

"Our most important priority is to find a solution to the diesel emissions matter and earn back the trust of our customers and dealers as we build a better company," Ginivan said.