D.he Volkswagen Group has already spent more than 30 billion euros to deal with the diesel scandal. Authorities in various countries have fined billions of dollars, car buyers have been compensated or continue to wrestle about them. In addition, shareholders want to have suffered damage from price losses. Now bond investors are also threatening the group with a lawsuit and using sharp rhetorical guns.
It is not just about “justified financial claims, but about the credibility of a model company and Germany as a business location,” said Henning Wegener from the board of the Volkswagen Investors Claim Foundation on Thursday. Many VW bond creditors have gathered behind the foundation under Dutch law.
For its initiative, the foundation has formed an alliance with the German Association for Protection of Securities, which sees itself as a mouthpiece for investor interests in Germany. The law firms Nieding + Barth from Frankfurt, AKD Benelux Lawyers from Amsterdam and Breiteneder from Vienna are also there. They have obtained support from litigation financier Vannin Capital, who wants to bear the litigation costs and, if successful, will receive part of the money won. The alliance offers investors the prospect of claiming up to 15 percent of their investment amount as damage to be reimbursed.
Value in dispute of four billion euros
As in other investor processes, the accusation is that VW informed investors too late about financial risks in connection with the manipulation of exhaust emissions from diesel cars. If the bond investors had known better at the time of their entry, so the argument goes, they would never have accepted the conditions of the securities with, in some cases, very low coupons. According to its own statements, the foundation represents investors with an invested capital of 13 billion euros.
Of this, 93 percent should be attributable to bondholders. In total, the lawyers even consider investors with a total of 60 to 70 billion euros to be eligible who had invested in one of 532 bonds of the group and its subsidiary. The prerequisite is that they had kept the papers between 2011 and 2015, when the scandal became known, said lawyer Klaus Nieding. A comparison will be sought, but if VW does not agree to it, they will sue.
A group spokesman said on Thursday that VW had not yet heard of a new lawsuit by bondholders. “Therefore, we cannot comment on this in any further detail.” Basically, the company is convinced that it has fulfilled all disclosure requirements. Against this background, the group considers alleged claims that bond creditors could assert to be unfounded. “We would defend ourselves against such claims by any legal means.” In America, VW recently won a legal battle related to securitized bonds. In August, a corresponding suit by the Securities and Exchange Commission was dismissed.
In Germany, investor lawsuits are pending at the Braunschweig Higher Regional Court. There, shareholders demand compensation for price losses suffered in a model investor procedure. Currently, the amount in dispute is said to be four billion euros. In the case of the holding company Porsche SE, which is controlled by the owner families Porsche and Piëch, the Federal Court of Justice could lead to a model action. Porsche SE rejects all allegations.