Hawaii Joins $149.7M Multistate Settlement with Mercedes-Benz Over Emissions Fraud

Release: HAWAIʻI ANNOUNCES NEARLY $150 MILLION MULTISTATE SETTLEMENT WITH MERCEDES-BENZ OVER EMISSIONS FRAUD

December 29, 2025 at 3:02 pm

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December 29, 2025

HONOLULU – The Hawaiʻi Department of Commerce and Consumer Affairs Office of Consumer Protection (OCP) joined a coalition of 50 attorneys general announcing a $149,673,750 settlement with Mercedes-Benz USA, LLC and Mercedes-Benz Group AG for violating state laws prohibiting unfair or deceptive trade practices by marketing, selling and leasing vehicles equipped with illegal and undisclosed emissions defeat devices designed to circumvent emissions standards. The Department of Health and the Department of the Attorney General joined OCP as parties in the suit on behalf of the State of Hawaiʻi.

Beginning in 2008 and continuing to 2016, the states allege Mercedes manufactured, marketed, advertised and distributed nationwide more than 211,000 diesel passenger cars and vans equipped with software defeat devices that operated differently during emissions testing than during normal operations. These defeat devices optimized emission controls during emissions tests, while reducing those controls during normal operations. The states allege the defeat devices enabled vehicles to far exceed many legal limits of nitrogen oxides (NOx) emissions, a harmful pollutant that causes respiratory illness and contributes to the formation of smog. Mercedes allegedly engaged in this conduct to achieve design and performance goals, such as increased fuel efficiency and reduced maintenance, that it was unable to meet while complying with applicable emission standards. Mercedes concealed the existence of these defeat devices from state and federal regulators and the public. At the same time, Mercedes marketed the vehicles to consumers as “environmentally-friendly” and in compliance with applicable emissions regulations. In addition to falsifying compliance with emissions standards, this concealment exploited consumer preference for lower emitting and more efficient vehicles.

“We must protect our environment for future generations and deliver certain consequences to those who break the law and pollute our air. Auto manufacturers have willfully been misleading the public about the level of harmful pollutants their vehicles were emitting,” said Executive Director of the Office of Consumer Protection, Mana Moriarty. “This settlement holds Mercedes-Benz accountable for past practices and prevents consumers from being misled in the future.”

Today’s settlement requires Mercedes-Benz USA, LLC and Mercedes-Benz Group AG to pay $120 million to the states immediately upon the effective date of the settlement. An additional $29,673,750 will be suspended and potentially waived pending completion of a comprehensive consumer relief program. The consumer relief program extends to the estimated 39,565 vehicles which as of August 1, 2023, had not been repaired or permanently removed from the road in the United States.

Hawaiʻi will receive $263,356.00 through today’s settlement for continued consumer protection efforts. Approximately 913 of impacted vehicles were sold or registered in Hawaiʻi.

Mercedes must bear the cost of installing approved emission modification software on each of the effected vehicles. The company must provide consumers with an extended warranty and pay consumers $2,000 per subject vehicle.

In addition, the company must comply with reporting requirements and reform their marketing practices, including a prohibition on any further engagement in unfair or deceptive marketing or sale of diesel vehicles, misrepresentations regarding emissions and compliance.

Today’s settlement follows similar settlements reached previously between the states and Volkswagen, Fiat Chrysler and German engineering company Robert Bosch GmbH over its development of the cheat software. Automaker Fiat Chrysler and its subsidiaries paid $72.5 million to the states in 2019. Bosch paid $98.7 million in 2019. Volkswagen reached a $570 million settlement with the states in 2016.

The attorneys general of Alabama, Connecticut, Delaware, Georgia, Maryland, New Jersey, New York, South Carolina, and Texas led today’s settlement. Alaska, Arkansas, Colorado, the District of Columbia, Florida, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Dakota, Tennessee, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, Wyoming, Puerto Rico and Hawaiʻi joined in the settlement.