By Stephen Collier
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Published 28 September 2026
More than a decade after the Volkswagen emissions scandal first emerged, the UK's "Dieselgate" litigation has reached a significant milestone. In July 2026, the High Court handed down a substantial judgment in one of the largest product liability and group litigation disputes ever brought before the English courts, involving claims by approximately 1.6 million vehicle owners against manufacturers including Mercedes-Benz, Ford, Nissan, Renault, and Peugeot-Citroën.
The decision provides important guidance on the scope of emissions-related claims and offers valuable insight into how the courts may approach future regulatory and product compliance disputes.
At the heart of the litigation are allegations that vehicle manufacturers fitted diesel vehicles with unlawful "defeat devices". These are technologies that allegedly enabled vehicles to satisfy emissions requirements during laboratory testing whilst producing higher emissions in real-world driving conditions. Claimants argued that these systems breached regulatory requirements and that consumers consequently suffered loss.
The High Court rejected the majority of those allegations. In particular, it held that an emissions-control system is not unlawful simply because it performs differently during laboratory testing than under normal driving conditions. Instead, claimants must demonstrate that the technology was specifically designed to recognise testing conditions and modify vehicle performance for the purpose of securing regulatory compliance. This clarification sets a relatively high evidential threshold and will be welcomed by manufacturers facing similar claims.
However, the judgment was not an outright victory for the automotive industry. The Court identified certain emissions-control strategies that it considered unlawful in specific vehicle models. These included a coolant-temperature strategy used in some Mercedes vehicles and a split-injection strategy implemented in certain Peugeot-Citroën models. The findings mean that some aspects of the claims remain alive and may continue to expose manufacturers to potential liability.
The Court also delivered another important ruling for future group actions. It confirmed that vehicle owners can, in principle, bring private law claims based on breaches of the relevant emissions legislation. This aspect of the decision may prove significant beyond Dieselgate itself, as it potentially reinforces the ability of consumers to seek compensation for alleged regulatory breaches where loss can be established.
Despite the scale of the July judgment, the dispute is far from over. The next major development is expected in October 2026, when a further trial involving Mercedes-Benz is scheduled to address key questions of causation, loss, and damages. Even where unlawful conduct is established, claimants will still need to demonstrate that they suffered a recoverable loss as a result. Those issues are likely to be heavily contested and may ultimately determine the financial significance of the litigation.
In parallel, the claimants have indicated their intention to challenge aspects of the July ruling but the status of any permission to appeal is unclear. A successful appeal could reopen parts of the case and further prolong proceedings. As a result, the litigation is likely to continue for some time, with substantial uncertainty remaining for both claimants and manufacturers.
From a broader corporate perspective, Dieselgate remains a powerful reminder of the long-tail risks associated with regulatory and product compliance issues and the broader trend towards environmental sustainability-related claims. Alleged misconduct dating back many years can still generate large-scale litigation, supported by sophisticated claimant firms, litigation funders, and coordinated group action mechanisms. The resulting exposure extends beyond legal liability and can encompass significant defence costs, management time, operational disruption, and reputational damage.
The case also illustrates the growing effectiveness of collective litigation as a means of pursuing consumer claims. By aggregating large numbers of relatively modest individual claims into a single coordinated action, group litigation enables claimants to pursue disputes that might otherwise be uneconomic to bring. As the UK collective redress landscape continues to develop, businesses operating in highly regulated sectors should expect increasing scrutiny of compliance decisions and a greater risk of large-scale follow-on litigation. For D&O Insurers, the increasing prevalence of large-scale litigation presents a risk that companies may be driven into insolvency which, in turn, will bring individual directors' knowledge and involvement under the spotlight.
For now, the July judgment narrows the scope of the Dieselgate claims but does not bring the saga to an end. With further trials and possible appeals still ahead, the litigation remains one of the most significant group actions before the English courts and an important case study in the intersection of regulation, consumer protection and collective redress.
