Attorney General Brenna Bird announced that Iowa has joined a coalition of 50 attorneys general in reaching a $149.7 million settlement with Mercedes-Benz USA. The settlement addresses allegations that the company violated state laws against unfair or deceptive trade practices by marketing, selling, and leasing vehicles equipped with illegal and undisclosed emissions defeat devices.
According to the states, over 211,000 diesel passenger vehicles sold between 2008 and 2016 were equipped with these devices. The states claim Mercedes used the defeat devices to meet design and performance goals—such as increased fuel efficiency and reduced maintenance—that would not have been possible while complying with emission standards. The existence of these devices was allegedly concealed from both regulators and consumers.
“Iowans deserve the truth when buying a vehicle,” said Attorney General Bird. “Software and cheat devices that can affect important issues like miles-per-gallon and maintenance should not be hidden so that Iowans can weigh the true value of the vehicle they want to purchase. I am happy today’s settlement is returning money to Iowans’ pockets along with providing warranty extensions.”
Under the agreement, Mercedes-Benz USA will pay $120 million to participating states upon implementation of the settlement. An additional $29.7 million may be waived if Mercedes completes a consumer relief program for approximately 39,565 vehicles that had not been repaired or permanently removed from service as of August 1, 2023.
Iowa will receive just over $3.1 million from this settlement, which will go into a state fund dedicated to future consumer litigation or education efforts.
This action follows similar multi-state settlements involving Volkswagen, Fiat Chrysler, and Robert Bosch GmbH related to emissions violations.
The case was co-led by Connecticut, Delaware, Maryland, Alabama, Georgia, New Jersey, New York, South Carolina, Texas; other participating jurisdictions include Alaska through Wyoming as well as Puerto Rico.
