In what many analysts believe is a way to force settlement, the U.S. Department of Justice filed a civil suit Tuesday against Fiat Chrysler Automobiles, alleging the company used undocumented software designed to beat diesel emissions testing.
The DOJ says this software, or 'defeat devices', enables diesel engines in 104,000 Jeep Grand Cherokee and Dodge Ram 1500 models built between 2014-2016 to bypass emission controls and emit ‘substantially’ higher than allowable levels of nitrogen oxide, or NOx pollution, which is linked to smog formation and respiratory problems. The suit seeks injunctive relief and unspecified civil penalties.
The EPA said in January the maximum fine is about $4.6 billion.
The lawsuit comes after months of negotiations and discussions between FCA, the EPA, the California Air Resources Board and other federal investigators.
The company last week proposed a software fix that it hoped would resolve a discrepancy on the emissions performance of the diesel vehicles in a move aimed at averting a legal battle.
However, the DOJ ultimately chose to file suit in this case, which could ultimately help lead to a settlement, as in an earlier probe of Volkswagen AG that will cost VW up to $25 billion, but which affected a much larger number of vehicles.
FCA denies all claims and says it will fight the allegations.
"FCA US is currently reviewing the complaint, but is disappointed that the DOJ-ENRD has chosen to file this lawsuit," FCA said in statement. "The Company intends to defend itself vigorously, particularly against any claims that the Company engaged in any deliberate scheme to install defeat devices to cheat U.S. emissions tests."
FCA and the Department of Justice, as well as the EPA, had been in discussions since the start of the year as the automaker readied a software patch for the 104,000 vehicles, in addition to 2017 model year diesels. The automaker indicated late last week that it had applied for certification for 2017 models that will have included updated emissions control software.
FCA also indicated that it intends to continue cooperating with the EPA and the California Air Resources Board to obtain approval.
In Volkswagen’s case, the company pleaded guilty earlier this year to using “defeat device” software that recognized when the car was being tested for emissions. The software changed, on demand, how the engine operated in order to meet those standards. The resulting scandal caused multiple resignations, criminal charges, and payouts reaching billions of dollars.
FCA, the DOJ alleges, employed software in its diesel engines that did pretty much the same thing - preventing emissions of nitrous oxides when it senses testing conditions, and that the level of these chemicals emitted during ordinary driving was high enough to ensure “this is a clear and serious violation of the Clean Air Act.”
"As FCA US announced last week, it has developed updated emissions software calibrations that it believes address the concerns of EPA and CARB, and has now formally filed for diesel vehicle emissions certification with the regulators for its 2017 model year Jeep Grand Cherokee and Ram 1500 diesel vehicles," FCA said in its statement. "Subject to the permission of EPA and CARB, FCA US intends to install the same modified emissions software in 2014-2016 Jeep Grand Cherokee and Ram 1500 diesel vehicles. FCA US believes this will address the agencies’ concerns regarding the emissions software calibrations in those vehicles."
