VW investors seek $ 11 billion in damages for dieselgate scandal

BRAUNSCHWEIG, Germany (Reuters) – Volkswagen (VOWG_p.DE) were judged Monday to face investors seeking 9.2 billion euros in compensation, arguing that the automaker should have informed shareholders earlier of its scandal of diesel emissions.

Shareholders representing 1,670 claims are demanding compensation for the Volkswagen (VW) share price triggered by the scandal that erupted in September 2015 and cost € 27.4 billion in penalties and fines. the society.

"VW should have told the market that they had cheated and generated risks worth billions," said Andreas Tilp, a plaintiffs' attorney, in the Braunschweig Higher Regional Court.

"We believe that VW should have told the market, by June 2008, that they could not manufacture the technology they needed in the United States."

The plaintiffs claim that VW has failed to inform investors of the financial impact of the scandal, which was only made public after the US Environmental Protection Agency (EPA) published a report. "Notice of Violation" on September 18, 2015.

The plaintiffs argued that if investors became aware of VW's criminal activities, they may have sold shares earlier or would not have made any purchases, thus avoiding losses on their shares.

VW's shares lost up to 37% of their value in the days following the authorities' disclosure of illegal pollution levels emitted by VW diesel cars.

VW has admitted systematic emission fraud, but denies any wrongdoing in regulatory disclosure.

"This case focuses on whether Volkswagen has complied with its disclosure obligations to shareholders and financial markets," said VW lawyer Markus Pfueller. "We are convinced that this is the case."

VW stated that the EPA's publication of the Notice of Violation did not correspond to the way the US authorities had handled similar cases involving other car manufacturers.

As VW was in talks to reach an agreement, VW's board of directors did not see the need to inform investors until September 2015, said the automaker in a case filed with court of VW. Braunschweig.

VW had already made substantial provisions at the end of 2015 to cover vehicle recalls, and as previous US authorities' fines for similar violations were less than $ 200 million, it was not necessary to inform investors under German law.

The board members at the time, including current CEO Herbert Diess and President Hans Dieter Poetsch, did not violate the disclosure rules, VW said in its defense statement filed with the court.

However, the plaintiffs, including fund manager Deka, allege that directors below the level of the board of directors, including division heads, were aware of the deliberate and systematic cheating of broadcasts. .

The company was therefore aware of the criminal activities and investors should have been warned earlier, according to the plaintiffs.

(1 dollar = 0.8648 euros)