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VW now facing class action lawsuit in Germany


03/15/2016

Ironically the suit has been filed in its home town of Lower Saxony, which is its second biggest shareholder.



A law firm representing 300 institutional investors who have filed a multi-billion euro lawsuit against German car manufacturing giant Volkswagen has said its clients have done so since VW has broken its capital markets duties arising out of the emission cheat scandal.

The lawsuit was filed in Braunscheweig which incidentally resides in Volkswagen’s home state of Lower Saxony. The suit has been filed by 278 investors from all over the world, and include German insurers and Calpers, a U.S. pension fund. The lawsuit is seeking 3.256 billion euro equivalent to $3.61 billion, in damages.

TISAB, the law firm handling this suite, said, the suit relates to Volkswagen neglecting its duties in the capital market during the period of June 2008 and Sept. 18, 2015.

When asked to react on this development, a spokesman for Volkswagen declined comments on the grounds that the company has yet to receive the suit.

This lawsuit comes in the wake of Volkswagen publishing an account of the events that led to the violations of the U.S. emissions laws, which was publicly announced by the U.S. EPA.

TISAB has also filed the German equivalent of a class-action lawsuit, called model claims, which is a German procedure used by individual investors to set damages for others who are equally affected.

"Due to the fact that – according to our information and experience - Volkswagen AG persistently denies any settlement negotiations and also refuses to waive the statute of limitation defense until now, it was necessary to file this first multi-billion euro lawsuit," said Andreas Tilp, a lawyer in a statement.

Last October Tilp filed a lawsuit on behalf of retail investors.