North Carolina Auto Parts Seller and its Owner to Pay $10M for Making, Selling and Installing Emissions Defeat Devices on Motor Vehicles

North Carolina Auto Parts Seller and its Owner to Pay $10M for Making, Selling and Installing Emissions Defeat Devices on Motor Vehicles

September 10, 2024

Rudy's pleaded guilty and was sentenced in federal court for conspiring to violate the Clean Air Act. U.S. District Court Judge Trevor N. McFadden for the District of Columbia ordered Rudy's to pay a criminal fine of $2.4 million and to complete a three-year period of organizational probation. In April 2024, Aaron Rudolf, sole owner and chief executive officer of Rudy's, pleaded guilty for conspiring to violate the Clean Air Act by tampering with monitoring devices on approximately 300 diesel trucks, which involved the installation of defeat devices on those trucks. He was sentenced to three years of probation and ordered to pay a $600,000 criminal fine.

Separate from the criminal actions, EPA and the Justice Department filed a civil complaint in 2022 against Rudy's and Aaron Rudolf for violating the Clean Air Act by manufacturing, selling and installing defeat devices and failing to adequately respond to the EPA's formal requests for information. Under a consent decree filed July 29, 2024, Rudy's and Rudolf will pay a $7 million civil penalty for those violations. The consent decree would also prohibit them from making, selling, offering to sell and installing defeat devices, transferring intellectual property that would allow others to make or sell defeat devices, and investing in or profiting from defeat devices manufactured or sold by other businesses. The decree is subject to court approval.

"For too many years, companies like Rudy's have installed illegal defeat devices to evade the public health protections of the Clean Air Act, to the detriment of communities across America," said David M. Uhlmann, EPA's Assistant Administrator for Enforcement and Compliance Assurance. "Today's announcement demonstrates that EPA will vigorously pursue criminal and civil penalties until this illegal behavior comes to an end."

"Defeat devices, such as those sold by Rudy's, can lead to pollution at high levels that pose health risks and harm the environment," said Assistant Attorney General Todd Kim of the Justice Department's Environment and Natural Resources Division. "This plea agreement and civil settlement show that we will take strong action to enforce the Clean Air Act and emissions controls requirements for motor vehicles."

"Those selling defeat devices are willing to pollute the environment so that they can personally profit," said U.S. Attorney Matthew M. Graves for the District of Columbia. "Today's sentencing makes clear that there will be significant consequences for those who traffic in these devices. Anyone considering peddling or installing these devices is on notice of the substantial costs of doing so."

"The Clean Air Act's protections are essential for the health and safety of our communities," said U.S. Attorney Sandra J. Hairston for the Middle District of North Carolina. "Tampering with emissions controls adds excess pollutants to the air we breathe and harms both public health and the environment. Settlements like these are essential to hold entities who violate the Clean Air Act accountable and to prevent harmful air pollution."

According to court documents in the criminal case, Rudy's sold defeat devices, known as delete tuners, which tampered with the on-board diagnostic systems (OBDs) of vehicles. Rudy's top selling product was the Mini Maxx delete tuner originally manufactured by another company, identified in court documents as "Company A." Rudy's also sold the XRT Pro, another Company A delete tuner. After Company A stopped making these tuners, Rudy's conspired with others to manufacture imitation Company A tuners. Rudy's reached an agreement with a software technician to convert certain tuners into imitation Company A tuners. That agreement ran from July 2015 through December 2016, when the software technician stopped converting tuners.

After that, Rudy's manufactured the imitation delete tuners in-house using a laptop computer that Rudy's purchased for $850,000. The laptop contained software to convert tuners into imitation Company A tuners. In-house manufacturing lasted from about December 2016 through July 2018. In total, Rudy's sold approximately 43,900 imitation tuners, generating about $33 million in revenue.

The civil lawsuit alleges that from at least 2014 through mid-2019, Rudy's and Rudolf manufactured and sold over 250,000 products designed to remove or disable EPA-mandated emissions controls. These products included hardware parts such as plates that block a vehicle's exhaust gas recirculation system and pipes that replace pollution treatment components in a vehicle's exhaust system.

Disabling or removing emissions controls and tampering with the OBD of a diesel truck causes its emissions - including nitrogen oxides, carbon monoxide, particulate matter and non-methane hydrocarbons - to increase significantly. Diesel exhaust is a mobile source air toxic because it poses cancer and noncancer health risks. In the civil complaint, the EPA estimates that the number of products sold by Rudy's amounted to adding over one million vehicles' worth of pollution to America's roads.

The $7 million that Rudy's and Rudolf will pay pursuant to the consent decree was based on their financial capability.

The consent decree was lodged in the U.S. District Court for the Middle District of North Carolina.

You can learn more about the Rudy's criminal and civil enforcement actions on EPA's Rudy's Settlement Information Sheet web page.