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Test case: investor process on the VW diesel affair: evidence needed

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Did VW inform the markets too late? Investors want billions in damages for price losses suffered. Now the court wants extensive evidence in the test case for the VW diesel affair.

The Braunschweig Higher Regional Court (OLG) considers extensive evidence to be necessary in the multi-billion dollar test case involving investors in the VW diesel affair. In view of the expected time-consuming measure with an open outcome, the Senate recommended that those involved examine settlement talks, the court said. In the process under the Capital Investor Model Proceedings Act (KapMug), there has been a dispute since 2018 about compensation for investors who suffered price losses in the billions after the diesel affair at VW was exposed.

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In the proceedings, with a value in dispute of around 4.34 billion euros, a central question is: Did VW inform the markets too late? The Senate reaffirmed its view that insider information had already existed since 2008 with the installation of the impermissible defeat device. For the issue of Volkswagen AG’s liability until July 2012, however, the model plaintiff had to prove that at least one member of the board was aware of the manipulation and had a reprehensible attitude towards investors.

For the period from July 2012, on the other hand, VW had to prove that the failure of the board of directors to notify the company was neither intentional nor grossly negligent. The decision was eagerly awaited by those involved and observers because it has a significant impact on the further course of the already tough process. Extensive hearings of various witnesses may now be expected. Two dates are scheduled for the end of May, where details should be clarified.

The aim of the process is to have key issues from the more than 1,900 initial proceedings that have been suspended in the past be decided in advance by the next higher instance. If there is a model decision, it is binding for the courts in all proceedings – this is what the Investor Model Proceedings Act provides for. The model defendants are Volkswagen and VW’s main shareholder, Porsche SE. The model plaintiff is Deka Investment.

Source: Stern

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