Volkswagen not cooperating with Ontario probe of emissions 'cheat devices': court documents
If the responses from VW’s Canadian office were getting chilly, the apparent feedback from VW in Germany was out-and-out frigid, investigators suggest
Ontario’s environment ministry investigators probing the international Volkswagen emissions scandal accuse officials with the German automobile company of not fully cooperating in their investigation.
Internal communication between Volkswagen and the Ministry of the Environment and Climate Change reveal increasing friction over two years of scrutinizing VW’s use of “cheater devices” on vehicles to evade environmental regulations.
From VW’s head office in Germany refusing to accept couriered letters from the ministry to VW Canada’s employees appearing reluctant to speak, several complaints about a lack of assistance are contained in a sworn affidavit in support of a search warrant for VW Canada’s headquarters in Ajax, Ont.
“We do not view the level of cooperation we have received as consistent with this commitment to your customers or the assertions of your counsel,” a ministry investigator wrote in a July letter to VW’s president, Maria Stenstroem, according to the affidavit, called an Information to Obtain, or ITO, filed in court.
The ITO notes VW’s public statement to customers on its website says VW Canada “will cooperate fully with the Ontario Government’s investigation.”
The Ontario probe stems from stunning revelations two years ago of software in some of VW’s diesel vehicles designed to hide the amount of contaminants released during emission tests. In the United States, VW agreed to pay more than $20 billion to settle criminal charges and civil claims over the scheme.
Ontario has now charged Volkswagen AG, the parent company in Germany of VW Canada, with breaching the province’s Environmental Protection Act by causing or permitting motor vehicles to operate with higher than allowed emission levels.
The breadth of the ministry’s investigation is highlighted in the court filing.
The ITO lists three “suspects”: VW’s parent company in Wolfsburg, Germany, and two wholly owned subsidiaries: Volkswagen Canada Group Inc. and Audi Canada Inc.
The ministry alerted VW to its investigation in October 2015 in a written request to Stenstroem for cooperation and information. The letter sought various types of information, according to the ITO.
The reply came from VW’s lawyer, Teresa Dufort, saying the company would cooperate and, a month later, some information was provided to investigators.
“No one currently employed at VGCA had knowledge of the software described… until after the disclosures” in the United States in 2015, Dufort wrote, according to the ITO.
Thus began a series of what appear to be increasingly strained exchanges between the ministry and the company.
VW suggested the province was wading into federal affairs and that since VW Canada only imported cars, not made them, investigators’ resources were misplaced. VW sought assurances information would remain confidential. VW complained the requests were becoming “very onerous” in terms of workload and “tenuous” in terms of value.
The investigators’ replies often noted missing information or answers they felt were incomplete and usually asking additional questions. They started requesting interviews with specific VW employees. The ministry also asked if VW would loan the ministry a 2011 and 2013 diesel Jetta for its testing, but a response is not noted in the ITO.
If the responses from VW’s Canadian office were getting chilly, the apparent feedback from VW in Germany was out-and-out frigid, investigators suggest in the ITO.
On May 12, 2016, a letter from investigators was sent through Purolator courier to Matthias Müller, the chief executive officer of Volkswagen AG in Germany who was named to the post after the resignation of his predecessor in the wake of the emissions scandal.
The package was refused, the ITO claims.
The ministry asked VW Canada’s lawyer to help deliver the letter to VW’s parent company. A response is not noted.
By July, ministry investigators were showing up at VW headquarters and phoning company officials asking for information they felt was missing. VW’s lawyer complained of the in-person visits over a voluntary request.
VW was cooperating “but is concerned about the tenor of the communications,” VW wrote to the ministry, according to correspondence quoted in the ITO.
In August, investigators went to more than two dozen VW dealerships around Ontario asking more than 60 employees what they new about the cheat scheme and when they first knew of it.
The ITO notes a lengthy series of questions investigators asked employees at various levels.
“The second series of questions related to whether the witnesses had any idea there was something wrong with the car because of the service they were performing on the car and whether they became aware they were working on an emission defeat device,” the ITO says.
Many of the employees said they first learned of the emissions scandal through the news media, the ITO says.
Some dealership managers said they attended a meeting in Toronto with VW officials and then had online meetings for updates. One described the meetings as “crisis management,” according to the ITO.
What was on the dealers’ minds at the meetings, one dealer told investigators, was “How do they stay in business,” the ITO says.
Little of the meetings were of a technical nature about the cheat devices, beyond company officials telling them their engineers are looking at it, the ITO says.
Service technicians and managers at dealerships generally told investigators they had no knowledge of what the software did, according to the ITO.
On July 21, investigators went to VW Canada’s headquarters to try to speak with two staff members they had been asking to interview, according to the ITO. They were told they would need to make an appointment. Later, the ministry was told the employees were on vacation.
On Aug. 3, an investigator went to the VW Canada’s headquarters to hand deliver a letter to Stenstroem asking to interview her.
“As part of its plea agreement in the United States, Volkswagen AG has admitted to certain facts in relation to the after sale modification of North American Volkswagen vehicles that had the defeat device, and these modifications occurred after you joined Volkswagen Canada,” the letter said, according to the ITO.
The next day, an email from VW’s lawyer said Stenstroem needed time to “obtain independent legal advice” before answering the investigators.
At the time of the raid on VW’s headquarters on Sept. 19, a VW Canada spokesman said: “We’ll continue to co-operate with them until they have the information they require … We’re not hiding anything.”
In correspondence with investigators quoted in the ITO, VW Canada denied contravening the environmental act.
Thomas Tetzlaff, a spokesman for VW Canada said: “Volkswagen Canada has not seen the document. It would not be appropriate to comment.”
Both electronic and paper documents were taken in the raid, according to an evidence log entered in court after the search — including binders, files and agenda taken from Stenstroem’s desk drawers and shelves and a box from her office windowsill.
Copies were taken of some employee’s computers, file folders and internal user directories. Also taken were copies of PowerPoint presentations.
