VW gets flood of German suits on eve of imaginary deadline

The Volkswagen AG headquarters

Volkswagen AG investors are preparing to flood a German court with more lawsuits over the carmaker’s emissions scandal to meet a deadline that lawyers say may be imaginary.
The Braunschweig Regional Court is bringing in extra staff for Sept. 19, the first business day after the one-year anniversary of VW’s admission that it rigged its cars to cheat emissions tests. Shareholders who want to sue VW over their losses are concerned that the day may be the deadline to file. While most lawyers doubt the date is really key, few are prepared to wait.
“Nobody wants to take the risk that courts may see that differently in the end,” said Thomas Asmus, a lawyer at Lindenpartners in Berlin. “The herd instinct is strong. Everybody’s filing now. I’ll do it too.”
The flood of new shareholder suits in Germany adds to the carmaker’s troubles. A year after admitting that about 11 million diesel vehicles had been equipped with software to cheat pollution tests, VW is far from resolving the fallout. It agreed to pay $16.5 billion to settle suits by some American authorities and car owners. Shareholders are incensed because the stock price dropped 35 percent in the two trading days after U.S. regulators disclosed the so-called defeat device.
The carmaker is already facing 380 pending investor suits in Braunschweig, the legal district that includes the company’s headquarters in Wolfsburg, claiming the leadership was aware as early as 2014 that U.S. authorities were probing test results and should have disclosed the investigation back then. One lawsuit bundles claims of almost 300 institutional investors and seeks 3.3 billion euros. Another group is seeking 700 million euros.
Instead of American-style class action suits, Germany gives plaintiffs a procedure that consolidates cases to centralize the evidence phase in capital-market actions in which a large number of investors claim to have been hurt by the same action.
VW continues to say the suits are unfounded because it informed the markets at each stage of the process.
“After a diligent review by internal and external legal experts, Volkswagen is of the view that the management board properly fulfilled its disclosure duties under capital-market rules,” the company said Monday in an e-mailed statement. Bloomberg