Not So Fast With That Lawsuit, Guys: Volkswagen

An anticipated multi-billion dollar lawsuit from disgruntled Volkswagen shareholders is without merit, the embattled German automaker said on March 2.

A document made public by Volkswagen states that the suit, which alleges a violation of disclosure obligations under capital markets law, is doomed to fail following an examination by legal experts from both inside and outside of the company.

News of the shareholder lawsuit emerged in mid-January after Volkswagen stocks tumbled precipitously in the wake of the diesel emissions scandal that engulfed the automaker last September. Reportedly, thousands of investors were lined up to demand a pound — or several — of Volkswagen’s warm, soft flesh.

The document asserts that while Volkswagen feels it is in the clear (on this charge, at least), an outside law firm will tackle the thorny legal matter of the emissions defeat device installed in its diesel vehicles for the past several years. It also included another official apology, something that has now become standard daily practice in Wolfsburg:

The Company emphasizes that this examination does not replace the independent investigation for the complete clarification of the diesel matter which is being conducted by the law firm Jones Day and is ongoing. The Company is making this public announcement to correct the selective and incomplete publication of documents in the media about the diesel matter and to avoid having partial excerpts of its statement of defense published in the media. Notwithstanding this, Volkswagen deeply regrets the incidents related to the diesel issue.

In order for Volkswagen to be be liable for financial losses under such a lawsuit, the company would have to have had prior knowledge of facts that were relevant to the stock price.

Volkswagen claims they were as shocked as anyone when word reached them of the Environmental Protection Agency’s allegations of violation of federal emissions laws on Sept. 18, 2015.

Until that point, Volkswagen argues “there were no indications whatsoever of information with relevance for the stock price,” given that they were already anticipating a recall of a half-million vehicles and significantly lower associated fines.

As the controversy continues its slow plod forward — and its sales continue their fast slide downward — Volkswagen says they’ll release the preliminary findings of their own investigation in the second half of April.