VW shareholders swamp German court with lawsuits

A German court says it has been inundated with 1,400 lawsuits from Volkswagen investors seeking damages worth $9.2 billion (8.2 billion euros) from the car manufacturer.

On Wednesday a regional court in Braunschweig, nearly 250 km (150 miles) west of Berlin, said it had received 1,400 lawsuits - 750 of them on Monday alone, from a single law office - as a potential one-year deadline to take legal action approached.

Investors - both institutional and individual - accuse VW of failing to disclose in a timely manner that it faced considerable legal costs after US regulators found the German automaker had manipulated cars' software in order to cheat on diesel emissions tests.

The plaintiffs say the relevant information could have helped them decide whether or not to sell their shares, which fell sharply after the US Environmental Protection Agency (EPA) unveiled its case against VW on September 18, 2015.

It's not certain that plaintiffs were up against a one-year deadline to take legal action, but lawyers said courts could eventually rule that those seeking damages had a one-year limit to make a legal claim.

The anniversary fell on Sunday - leaving potential plaintiffs until Monday to file suit.

VW scoffs at suits

VW insists it met all of its disclosure duties. An unnamed spokesman for VW maintained the carmaker's position that it "continues to believe that we comprehensively fulfilled our obligations under capital markets law and that the claims are unjustified."

German cities bemoan loss of taxes from VWMonday's legal deluge did not panic investors, more broadly, as VW shares moved little throughout the day on Wednesday - once news of the lawsuits was made public.

The firm claims that prior to the EPA's faulty emissions announcement it still appeared as if the diesel violation might be resolved by working with authorities and paying a relatively modest fine in the area of $100 million or less.

But things didn't work out that way, and the company has ended up putting aside $20 billion to cover potential fines and consumer claims, however, analysts now say the final hit to VW could approach $40 billion.

The company has already agreed to pay $15 billion in compensation and fines in the United States alone.

In September 2015 VW admitted to US regulators that 11 million diesel-powered vehicles around the world were armed with so-called "defeat devices."

The software would significantly improve the vehicle's exhaust fumes when it detected it was undergoing a regulatory test, and then revert to higher polluting rates after the test ended.

The result was emissions of nitrogen oxides far in excess of legally permitted levels.

bik/jil (AP, AFP, dpa)