Federal judge partially allows dealer lawsuit against Volkswagen to proceed

On the Dash:

• The court’s split decision allows key elements of the dealer association’s lawsuit to move forward against Volkswagen.
• The ruling narrows the case, signaling which claims meet federal legal standards at this stage.
• The outcome remains unresolved, with further litigation expected as surviving claims proceed.

A federal judge in California has granted in part and denied in part motions to dismiss filed by Volkswagen of America and related defendants in a lawsuit brought by the California New Car Dealers Association (CNCDA).

In an order dated March 30, 2026, Chief District Judge Cynthia Bashant of the U.S. District Court for the Southern District of California ruled on motions to dismiss filed under ECF Nos. 52, 53, and 54 in the case California New Car Dealers Association v. Volkswagen of America, Inc. et al, No. 3:2025cv01316.

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The ruling allows certain portions of the dealer association’s claims to proceed while dismissing others, though the order does not fully resolve the case. The lawsuit remains active following the partial denial of the defendants’ motions.

The case centers on a dispute between the CNCDA and Volkswagen of America, along with additional named defendants. The court’s decision marks a procedural milestone, determining which claims meet the legal threshold to continue through litigation.

By granting the motions in part and denying them in part, the court effectively narrows the scope of the case as it moves forward. Claims that survived dismissal will proceed to the next phase, while others have been removed in accordance with the court’s order.

The decision does not represent a final judgment on the merits of the case but instead addresses the legal sufficiency of the claims presented in the complaint.

The case was filed under docket number 3:2025cv01316 in the Southern District of California and remains ongoing.