A Volkswagen salesperson says the company’s deceptive practices have caused considerable financial harm for he and his colleagues.
Plaintiff Mickey Gaines claims the Volkswagen emissions cheat device scandal tarnished the brand’s good reputation and caused a drop in demand for Volkswagen vehicles. Those harms translated to lower sales and a loss of income for commissioned Volkswagen sales personnel like himself, he claims.
The scandal came to light in September 2015, when the U.S. Environmental Protection Agency (EPA) published a Notice of Violation alleging Volkswagen had installed cheat devices in millions of cars for the specific purpose of passing emissions tests.
These cheat devices cause the cars to produce lower emissions during emissions testing. During normal driving, however, the devices allow the cars to produce emissions several times over the legally allowable limit.
“As a direct and foreseeable result of the unlawful Volkswagen emission fraud, the Volkswagen salespersons such as Plaintiff have been harmed in their business in the form of reduced sales, diminished inventories, lost commissions and being charged with the responsibility of selling a product which essentially cannot be sold,” Gaines alleges.
VW Sales Rep: Deceptive Practices Hit Sales Reps in Their Pocketbooks
Gaines says he has worked as a commissioned sales representative for Livingston VW of Woodland Hills, Calif. since 2011. He says he chose to work for a Volkswagen dealership because of the brand’s long history, its reputation for exceptional engineering, and its environment-friendly business culture.
Volkswagen sales dropped as soon as these deceptive practices were publicized, the VW lawsuit claims. Gaines cites reports that deliveries of Volkswagen passenger brand vehicles dropped 5.3 percent in October 2015. By July of 2016, reports showed Volkswagen sales had plummeted by 17 percent.
Gaines says that the drop in sales translated directly to a loss of revenue for Volkswagen sales representatives like himself. Compensation for these salespersons is largely derived from a commission based on their total sales. A drop in sales meant a drop in income for Gaines and his fellow sales workers.
As a Volkswagen sales representative, Gaines says, he has cultivated a loyal customer base, leading some of his customers to return to him for repeat purchases. But reports of the company’s deceptive practices damaged those business relationships, Gaines says, driving away loyal customers and turning them into vocal detractors.
According to Gaines, Volkswagen left its sales personnel hanging after the scandal broke, providing them with no useful information to pass on to their customers and no guidance as to how to preserve their customer relationships.
Gaines proposes to represent a plaintiff Class consisting of all persons in the United States. who worked as Volkswagen commissioned sales representatives from Sept. 18, 2015 through the date of final judgment in this action.
He raises claims for interference with economic relationships, fraud, breach of contract, breach of the covenant of good faith and fair dealing, and violations of the federal Racketeer Influenced and Corrupt Practices Act, or RICO.
He seeks an award of damages, restitution, disgorgement, and reimbursement of attorneys’ fees and costs of litigation, all with pre- and post-judgment interest.
The Volkswagen Deceptive Practices Class Action Lawsuit is Mickey Gaines v. Volkswagen Group of America Inc., et al., Case No. 3:17-cv-01114, in the U.S. District Court for the Northern District of California.
If you were harmed by the deceptive practices of an employer or another company, you may be entitled to compensation. Learn more by filling out the form on this page.
Note: Bradley/Grombacher LLP is one of the law firms representing the plaintiff in this class action lawsuit.