Volvo Will Appeal $72 Million Penalty Over EPA Settlement

Volvo AB (VOLVB) will appeal a $72 million penalty imposed on its truck-engine unit after a federal judge found the company violated a 1999 emissions-control agreement with the U.S. Environmental Protection Agency.

Volvo Powertrain Corp. seeks reversal of an April 13 ruling that it breached a consent decree on emissions standards for heavy-duty diesel engines, according to a notice of appeal filed today in the U.S. Court of Appeals in Washington. U.S. District Judge Royce Lamberth ruled that 8,354 engines weren’t compliant.

“Volvo believes the consent decree covers only the engines specifically referenced, which are certain specified Volvo Powertrain on-highway engines and Volvo Construction Equipment non-road engines,” the Gothenburg, Sweden-based company said in a statement when the court decision was issued.

Volvo and six other manufacturers of heavy diesel engines agreed to spend $1 billion to settle charges that they had “illegally poured millions of tons of pollution into the air,” according to a Justice Department press release.

At the time it was announced, the settlement, approved by a federal judge in 1999, was the largest environmental enforcement penalty, according to the statement.

The case is U.S. v. Volvo Powertrain Corp., 12-05234, U.S. Court of Appeals for the District of Columbia (Washington).

To contact the reporter on this story: Tom Schoenberg in Washington at tschoenberg@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.

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