WASHINGTON—Volkswagen AG agreed to a $3.5 million settlement with Ohio over claims the German automaker violated state laws by manipulating vehicle computer software in its vehicles to mask carbon dioxide emissions, the state attorney general said. In November, the U.S. Supreme Court rejected Volkswagen’s bid to avoid lawsuits filed by officials in three states including Ohio. Volkswagen’s U.S. subsidiary argued that under the Clean Air Act, the landmark U.S. environmental law, only the federal government can pursue emissions claims. VW noted it had already reached a settlement of more than $20 billion with the U.S. Environmental Protection Agency and owners. “This agreement fully resolves Ohio’s legacy claims and puts this matter behind the company as we focus on building a future of sustainable mobility,” VW said Friday. Texas and two counties in Utah and Florida have pending lawsuits. The settlement is a fraction of what Ohio had previously sought. VW …