VW sued for $3.7 bil­lion in Ger­many over diesel scan­dal

The Pak Banker - - COMPANIES/BOSS -

Volk­swa­gen AG was sued for 3.3 bil­lion euros ($3.7 bil­lion) over the cover-up of its pol­lut­ing diesel en­gines, its big­gest le­gal chal­lenge in Ger­many to date af­ter a wave of law­suits in the U.S. cen­tered on the scan­dal. The case was filed Mon­day in Braun­schweig on be­half of 278 in­sti­tu­tional in­vestors from around the world, lawyer An­dreas Tilp said by tele­phone. The suit claims VW failed to pub­lish in­for­ma­tion about the emis­sions scan­dal in a timely man­ner, he said.

The case comes al­most six months af­ter Volk­swa­gen ad­mit­ted it in­stalled soft­ware in its diesel ve­hi­cles to cheat emis­sions test­ing, a scan­dal that's rip­pled through the global car in­dus­try. Sixty-five cases are pend­ing in Braun­schweig over the is­sue, the court said last week. The com­pany also faces a mul­ti­tude of law­suits in the U.S. as well as crim­i­nal probes in var­i­ous coun­tries.

Be­cause Volk­swa­gen has re­fused to take part in set­tle­ment ne­go­ti­a­tions and won't waive a statute of lim­i­ta­tions de­fense, it was nec­es­sary to file the law­suit, Tilp said.

Eric Fel­ber, a spokesman for Wolfs­burg-based VW spokesman, de­clined to com­ment on the law­suit un­til the com­pany had seen a copy of the com­plaint.

VW stock fell as much as 2.2 per­cent to 113 euros in Frank­furt trad­ing and was down 1.2 per­cent at 10 a.m.

"There is deep value in VW but the un­cer­tainty around all the po­ten­tial claims against the com­pany make it dif­fi­cult to in­vest," Sascha Gom­mel, an an­a­lyst at Com­m­merzbank AG in Frank­furt, said in a note to clients.

Tilp has rep­re­sented in­vestors in many Ger­man cases over cap­i­tal-mar­ket dis­clo­sure is­sues. His firm rep­re­sents in­vestors su­ing Porsche SE for a com­bined 2.6 bil­lion euros.

Among the plain­tiffs in the new VW case are in­vestors from Aus­tralia, Aus­tria, Canada, Den­mark, France, Italy, Ja­pan, Lux­em­bourg, the Nether­lands, Nor­way, Swe­den, Switzer­land, the U.K., the U.S. and Tai­wan. Th­ese groups in­clude 17 Ger­man in­vest­ment man­age­ment com­pa­nies as well as in­sur­ance com­pa­nies and the Cal­i­for­nia Pub­lic Em­ploy­ees' Re­tire­ment Sys­tem, one of the largest pen­sion funds in the U.S., Tilp said.

An­other 20 in­sti­tu­tional in­vestors seek­ing more than 1 bil­lion euros are in talks with the firm about an ad­di­tional suit, Tilp said.

Tilp filed the first in­di­vid­ual share­holder case against VW on Oct. 1. The lawyer has asked the court to open test­case pro­ceed­ings. If the re­quest is granted, all cap­i­tal-mar­ket cases will be jointly heard in a spe­cial pro­ce­dure be­fore the Braun­schweig Higher Re­gional Court in the Ger­man state of Lower Sax­ony.

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