Investors Sue Volkswagen for $10.7B Over Dieselgate
Volkswagen's diesel emissions scandal nightmare isn't over yet.
Volkswagen is eager to leave its diesel emissions scandal behind, but a group of investors want to have the last word. Investors reportedly seek $10.7 billion (9.2 billion euros) in compensation for the resulting 37 percent plunge in Volkswagen stock values.
A collection of 1,670 legal claims have been tied together in a single mega-lawsuit against Volkswagen by some of its investors, filed in a German court. According to Reuters, they claim the automaker was not completely honest about the severity of the diesel emissions scandal that surfaced in 2015, commonly referred to as "Dieselgate," which led to an industry-wide investigation of consumer vehicles for similar emissions cheating devices.
They allege that Volkswagen should have notified its shareholders of the extent of the investigation prior to the notice of violation handed down by the Environmental Protection Agency on Sept. 18, 2015. According to court documents cited by Reuters, Volkswagen's board of directors was in the process of negotiating a settlement prior to receiving the EPA's notice of violation, and thus did not see reason to disclose the matter to investors.
"Neither the management board nor individual board members caused or were involved with the compliance violation in the United States," Volkswagen reportedly stated in a court filing.
The Drive contacted Volkswagen for a statement on the lawsuit and we will update when we receive a response.
Nevertheless, high-ranking Volkswagen Auto Group (VAG) officials have been arrested in connection to Dieselgate, and some convicted, such as Oliver Schmidt in December. Former Audi CEO Rupert Stadler, arrested in June for his suspected involvement, was denied bail in July, as courts believed he may attempt to tamper with evidence. Other lawsuits have been filed in relation to Dieselgate, including one targeting Volkswagen's "clean diesel" ads run prior to the scandal, labeled false advertising by the Federal Trade Commission.
Even though Volkswagen is investing heavily in electric vehicles to clean its reputation dirtied by Dieselgate, it faces an uphill battle to redeem its own name—let alone that of diesel.