Volkswagen Investors Want an Expensive Pound of Flesh

Steph Willems
by Steph Willems

The numbers are big — 278 investors seeking $3.61 billion — but the latest lawsuit leveled at Volkswagen is merely another drop in the penalty bucket for the embattled automaker.

As has been expected for some time, a group of institutional investors from numerous countries is seeking compensation for financial damage caused by Volkswagen’s diesel emissions scandal, Reuters is reporting.

The lawsuit was filed Monday in a Lower Saxony court — the same jurisdiction as Volkswagen’s headquarters — and alleges the automaker breached its duty under capital markets law between the time the “defeat device” was first installed in diesel models and when the scandal went public last September.

Sparked by the E.S. Environmental Protection Agency’s Notice of Violation, the scandal saw Volkswagen shares plunge in value, wiping billions out of the portfolios of investors who had been unaware of what was occurring behind the scenes at Volkswagen.

Among the group’s members are a number of German insurers and the California Public Employees’ Retirement System.

Their lawyer, Andreas Tilp of law firm TISAB, said the suit was filed because Volkswagen “persistently denies any settlement negotiations and also refuses to waive the statute of limitation defense until now.”

Earlier in the month, Volkswagen released a document explaining what it knew about the defeat device and when, using the admission to throw cold water on looming investor lawsuits.

However, the automaker’s official recollection has been called into question ever since, and this past weekend news arose that suggests a possible cover-up in the U.S.

Investigations into the Volkswagen are continuing as the automaker struggles to come up with a plan to recall and fix the affected diesel vehicles, sold between 2009 and 2015. In addition to the growing list of lawsuits and the expense of fixing millions of vehicles, the company is also facing fines totaling in the tens of billions of dollars from regulators.

Steph Willems
Steph Willems

More by Steph Willems

Comments
Join the conversation
5 of 46 comments
  • Daniel J Daniel J on Mar 16, 2016

    Isn't investing about taking a risk? I wish I could have sued when the markets tanked back in 07 and 08.

    • See 2 previous
    • DenverMike DenverMike on Mar 16, 2016

      @Daniel J "Almost" only counts in 'horseshoes' and hand grenades. Seriously, sorry for your banking/investments losses, but that was more of a ponzi scheme. This VW scandal was criminal in an overt, blatant kind of way.

  • Brandloyalty Brandloyalty on Mar 16, 2016

    Another form of damage yet to be accounted for is the sales lost to VW, on the basis of lies, by other automakers. This has implications all the way from part suppliers to sales staff; and includes losses to hybrid sales resulting from unfair comparisons to VW diesels. Then there's the environmental costs, but who's standing up for those?

  • Kwik_Shift Hyunkia'sis doing what they do best...subverting expectations of quality.
  • MaintenanceCosts People who don't use the parking brake when they walk away from the car deserve to have the car roll into a river.
  • 3-On-The-Tree I’m sure they are good vehicles but you can’t base that on who is buying them. Land Rovers, Bentley’ are bought by Robin Leaches’s “The Rich and Famous” but they have terrible reliability.
  • SCE to AUX The fix sounds like a bandaid. Kia's not going to address the defective shaft assemblies because it's hard and expensive - not cool.
  • Analoggrotto I am sick and tired of every little Hyundai Kia Genesis flaw being blown out of proportion. Why doesn't TTAC talk about the Tundra iForce Max problems, Toyota V35A engine problems or the Lexus 500H Hybrid problems? Here's why: education. Most of America is illiterate, as are the people who bash Hyundai Kia Genesis. Surveys conducted by credible sources have observed a high concentration of Hyundai Kia Genesis models at elite ivy league universities, you know those places where students earn degrees which earn more than $100K per year? Get with the program TTAC.
Next