VW blasted for shielding emissions documents from U.S. probe

By David Shepardson

(Reuters) - Three U.S. state attorneys general criticized Volkswagen AG on Friday for citing German law to withhold documents from a group of states investigating the German automaker's use of illegal diesel emissions software.

Connecticut Attorney General George Jepsen said it was "frustrating" that "despite public statements professing cooperation ... Volkswagen is, in fact, resisting cooperation by citing German law."

Officials said VW is withholding emails between its executives and other communications from the group of 48 U.S. state attorneys general investigating excess emissions in 580,000 U.S. diesel cars. The U.S. Justice Department and German prosecutors are also investigating the automaker, which has said up to 11 million vehicles worldwide had the software.

With Volkswagen citing German privacy law, New York Attorney General Eric Schneiderman said the German automaker "has failed to pursue every avenue to overcome the obstacles" it has cited. "Our patience with Volkswagen is wearing thin."

He complained that VW's cooperation has been "spotty." VW "has been slow to produce documents from its US files, it has sought to delay responses until it completes its 'independent investigation' several months from now," Schneiderman said in a statement.

Megan Hawthorne, a spokeswoman for Michigan Attorney General Bill Schuette, said "we share the frustrations" of New York and Connecticut. "We will do what is necessary to move the investigation forward."

State attorneys general could take further steps to try to compel cooperation. VW declined to say if it is withholding documents.

The company has blamed the deception on a small group of employees. It has hired advisory firm Deloitte and U.S. law firm Jones Day to investigate the circumstances under which the company installed software into diesel cars that changed engine settings to reduce emissions whenever vehicles were tested.

"We are in permanent exchange with U.S. authorities and are cooperating closely with them. We are not commenting on ongoing investigations," a spokesman at Wolfsburg-based VW said.

Jepsen said state AGs will "seek to use any means available to us to conduct a thorough investigation of Volkswagen's conduct."

On Monday, the Justice Department filed a civil suit against VW seeking up to $46 billion for Clean Air Act violations in allowing excess emissions in 580,000 diesel vehicles. A criminal investigation is ongoing.

The Justice Department's suit said government "efforts to learn the truth about the (excess) emissions ... were impeded and obstructed by material omissions and misleading information provided by VW entities."

VW CEO Matthias Mueller will meet with Environmental Protection Agency Administrator Gina McCarthy on Wednesday in the highest-level talks since VW's emissions scandal became public in September.

"We haven't identified a satisfactory way forward, but those discussions are going to continue," McCarthy said Thursday.

(Reporting by David Shepardson Additional reporter by Andreas Cremer in Berlin; Editing by David Gregorio)