Cummins Inc to pay $1.7B in Ram Emissions Suit

123
SHARE
Cummins Inc to pay $1.7B in Ram Emissions Suit

Engine manufacturer Cummins Inc. has reached a groundbreaking $1.675 billion settlement with the federal government and the state of California, resolving allegations of emission limit violations through the installation of undisclosed devices on nearly a million Dodge Rams. Described by U.S. Attorney General Merrick Garland as the largest Clean Air Act settlement to date, the deal addresses the widespread impact of aftermarket emissions defeater devices that may have caused substantial excess emissions.

Record-Breaking Accord and Clean Air Act Implications

In a Friday statement, Cummins publicly announced the settlement, emphasizing its compliance with regulators and denying any wrongdoing. Garland, however, stated on Thursday that the alleged installation of emissions-defeating devices by Cummins may have resulted in thousands of tons of excess emissions. The government is now committed to incorporating the deal into a consent decree, preventing a recurrence of the alleged misconduct.

Justice Department’s Aggressive Stand

Attorney General Garland asserted, “Violations of our environmental laws have a tangible impact — they inflict real harm on people in communities across the country.” This historic agreement signifies the Justice Department’s commitment to holding accountable those who prioritize profit over public health and safety.

Cummins’ Response and Comprehensive Resolution

Cummins, in its Friday statement, clarified that it had already recalled a significant portion of the 960,000 affected 2013 to 2019 RAM 2500 and 3500 pickup trucks. The company anticipates incurring a $2.04 billion expense in the fourth quarter of 2023 to resolve the government’s case and other related matters. Cummins highlighted a four-year internal review, collaborating with regulators and a cooperative approach with environmental authorities to bring resolution to the Clean Air Act allegations.

Cummins Inc to pay $1.7B in Ram Emissions Suit : Unprecedented Penalties and Legal Precedent

The $1.675 billion penalty imposed on Cummins for alleged emissions law violations is touted as the largest Clean Air Act penalty ever, according to Garland. This landmark settlement marks the second-largest fine secured by the Department of Justice for any environmental issue, following BP Exploration & Production Inc.’s $20 billion penalty for the Deepwater Horizon oil spill in 2015.

Corporate Commitments Amid Legal Challenges

Cummins, reiterating its stance of non-admission to wrongdoing, emphasized its ongoing commitment to emissions reduction. A company representative stated, “[W]e are a leader in the decarbonization of our industry and we continue our investments in U.S. manufacturing and clean technologies, including $1 billion in existing plants.” Despite legal challenges, Cummins remains focused on its future and the ongoing journey toward decarbonization.

Ongoing Legal Battles and Consumer Claims

While settling with government entities, Cummins faces consumer claims in Michigan federal court. A proposed class action by Dodge Ram drivers alleges that Cummins and Fiat Chrysler defrauded them about their vehicles’ emissions performance. Represented by in-house attorneys and outside counsel from Sidley Austin LLP, Cummins navigates a complex legal landscape.

Cummins Inc to pay $1.7B in Ram Emissions Suit : Conclusion

The $1.675 billion settlement between Cummins Inc. and federal and state authorities signals a monumental step in holding corporations accountable for environmental violations. As the legal saga unfolds, Cummins remains firm in its commitment to cleaner technologies, navigating a complex terrain of legal challenges and public scrutiny.