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A federal lawsuit has been filed against Volkswagen for its use of a “defeat device” intended to fool U.S. regulators. The auto giant acknowledges that millions of its diesel cars worldwide relied on a ruse to escape emissions controls.

The complaint was filed in federal court, with the Department of Justice (DOJ) acting on behalf of the Environmental Protection Agency (EPA) which has yet to reach an acceptable agreement with Volkswagen over how to organize a recall.

The vehicles were putting up to 40 times more pollution into the air than permitted under U.S. standards, according to the EPA. Despite vehicles; being awarded clean emissions credentials that led to steep federal tax credits. For instance, in 2009 (the first year covered by the complaint), Americans who purchased a diesel-powered VW Jetta received a $1,300 credit.

“The DOJ alleges that nearly 600,000 diesel engine vehicles had illegal defeat devices installed that impair their emission control systems and cause emissions to exceed EPA’s standards, resulting in harmful air pollution.

“Moreover the complaint alleges that Volkswagen violated the Clean Air Act by selling vehicles that were designed differently from what Volkswagen had stated in applications for certification to EPA and the California Air Resources Board.”

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