VW Customer Care Diesel Fraud: Hello South Dakota

Volkswagen announced its customer care program for consumers cheated by the clean diesel fraud. The program gives consumers who register a $500 Visa gift card, a $500 dealer coupon, and three years of free roadside assistance.

The last two benefits are nothing more than slick marketing, designed to drive sales. The first–that Visa card–comes with some wicked fine print.

You have to root around in the shiny website to find the cardholder agreement, and then you have to page through that to get to this gem:

“10. WAIVER OF RIGHT TO TRIAL BY JURY
YOU AND WE ACKNOWLEDGE THAT THE RIGHT TO TRIAL BY
JURY IS A CONSTITUTIONAL RIGHT BUT MAY BE WAIVED IN CERTAIN CIRCUMSTANCES. TO THE EXTENT PERMITTED BY LAW, YOU AND WE KNOWINGLY AND VOLUNTARILY WAIVE ANY RIGHT TO TRIAL BY JURY IN THE EVENT OF LITIGATION ARISING OUT OF OR RELATED TO THIS AGREEMENT. THIS JURY TRIAL WAIVER SHALL NOT AFFECT OR BE INTERPRETED AS MODIFYING IN ANY FASHION THE DISPUTE CLAUSE SET FORTH IN THE FOLLOWING SECTION, IF APPLICABLE, WHICH CONTAINS ITS OWN SEPARATE JURY TRIAL WAIVER.

IN THE EVENT OF ANY DISPUTE OR CLAIM RELATING IN ANY WAY TO THIS AGREEMENT, CUSTOMER AGREES THAT SUCH DISPUTE SHALL BE RESOLVED BY BINDING ARBITRATION WITH THE AMERICAN ARBITRATION ASSOCIATION, UTILIZING THE RULES OF PROCEDURE OF SUCH ARBITRATION SERVICE, FURTHER, ANY SUCH ARBITRATION SHALL TAKE PLACE IN SIOUX FALLS, SOUTH DAKOTA AND THE LAWS OF THE STATE OF SOUTH DAKOTA SHALL APPLY. THE DECISION OF AN ARBITRATOR WILL BE FINAL….”

Show of hands: So who wants to go to Sioux Falls to have their case decided by a professional, corporate arbitrator?

It is unclear whether VW is trying to capture the Diesel Fraud claims in this arbitration clause, but the language is broad enough to raise serious questions.

And of course, VW is trying to buy consumers’ loyalty for $1,000. Seems kind of cheap, given the scope of this multi-billion dollar fraud.

At bottom, this is risky business.

-David

6 thoughts on “VW Customer Care Diesel Fraud: Hello South Dakota

  1. This appears to be an agreement between the cardholder and visa. How does this arbitration clause, found in the visa terms and conditions, limit one’s ability to bring suit against VW who is not party to the cardholder terms? Also, I’d be interested to know more about your suit. Thanks.

  2. “Appears” is the right word. My guess is that that is the intention, but pro-arbitration courts give expansive readings to these clauses. If the dispute could sweep in Volkswagen and the credit card company, the arb clause could come into play. There are a number of ways this could unfold. While I think it is unlikely, it is hardly impossible. Sending you info via email. -David

  3. I read the fine print after I clicked accept. Now I’m concerned after I read the fine print. I haven’t joined a class action lawsuit yet but it’s on my mind and wonder if by accepting if I limit my options going forward. I would have to redeem this at a dealership and they have to verify eligibility and mileage. I regret not reading before.

  4. I can’t even find the web site that VW wants you to register on. Given the number of letters I have received from law firms I assumed this was a ploy by VW to limit it’s liability. It seams to be a low ball offer for the benefit of it’s dealers.

  5. What do you make of Goodwill Package Rules/Additional Program Rules Rule #9 that states in its latter half, “Eligibility, registration, activation and redemption of Goodwill Package are subject to present and future program rules, which are incorporated by reference and may be modified by VWoA at any time without notice.”

    I am extremely suspicious of this program and don’t want to take any actions that limit future benefits. I agree it looks like an attempt to boost profits. Further, what is the benefit (to VWoA) of arbitration in Sioux City, SD over any other location?

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