Volkswagen investors suing over emissions scandal

Volkswagen (VW), the German car giant, is being charged with €8.3bn in damages from 1400 German investors over its emissions scandal last year.

On the first business day after the anniversary of VW’s diesel emissions test-rigging scandal the Braunschweig court said it received around 750 lawsuits relating to the drop in Volkswagen’s share price after the scandal broke.

Plaintiffs said shareholders were not informed fast enough about the company’s cheating software that was installed in up to 11m vehicles worldwide.

The company’s preference shares lost around 45% of their value between September and October 2015 and are still down by about 28%.

The car maker has insisted that it did not break capital market regulations in the disclosure of its cheating.

It has, however, admitted to cheating on their emissions tests in the US and agreed to pay $10.2bn to settle some of its US claims.

Australia joined in the legal action against the car maker earlier this month and last week asset manager Blackrock and a group of institutional shareholders said they would sue VW for €2bn.

Around $18 billion has been set aside by the company to cover the cost of vehicle refits and the settlement with the US authorities, but analysts think the company will need much more following these further lawsuits and regulatory penalties.

The court detailed additional complaints on Wednesday, saying they included a filing by institutional investors for €30m in damages, two investor groups demanding €1.5bn and €550m respectively and an investment company that sued the car maker for 45 million euros. Complaints have also been filed by German state pension funds.

The firm brought in extra staff to process the claims submitted by shareholders as it was concerned that the anniversary of the day its manipulation was uncovered may be the deadline to file. The extra claims would take about four weeks to fully process according to the court.

A VW engineer James Liang became the first to be charged as part of the US Justice Departments year-long criminal probe into the firm’s rigging of federal air-pollution tests after pleading guilty earlier this month to violation of the clean air act, a wire fraud count and a consumer fraud count and.

Liang could face five years in prison however his cooperation with the US federal government could reduce his jail time. His trial is being held in January.

The share price was flat at €128.55 at 1622 BST on Wednesday.