Diesel Scandal: Investors sue VW for over $1 billion

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Investors dragged Volkswagen to court on Monday to seek compensation for the hit to the German carmaker's share price from its diesel emissions scandal, arguing that the company should have informed shareholders earlier about the financial impact of the scandal.

Shareholders representing 1,670 claims are seeking 9.2 billion euros (10.6 billion US dollars) in damages over the scandal, which broke in September 2015 and has cost Volkswagen (VW) 27.4 billion euros (31.8 billion US dollars) in penalties and fines so far.

It is likely, however, that only some of the claims will be taken into account because of the statute of limitations, presiding judge Christian Jaede told the Braunschweig higher regional court as proceedings began, without giving a figure.

Andreas Tilp, a lawyer for some of the plaintiffs, said he believes that claims worth two billion euros of the roughly five billion euros he represents have a chance.

"We are very confident that there will be money at the end of the day," he said.

Judge Jaede said the case was highly complicated, with many legal questions to be clarified. The court has not yet set a detailed timetable for proceedings in a case that could well end up in a higher court.

The plaintiffs say VW failed in its duty to inform investors about the financial impact of the scandal, which became public only after the US Environmental Protection Agency (EPA) issued a "notice of violation" on Sept. 18, 2015.

Had investors known about VW's criminal activities in rigging emissions tests, they may have sold shares earlier or not made purchases, thereby avoiding losses on their holdings, the plaintiffs argue.

VW shares lost up to 37 percent of their value in the days after authorities exposed illegal levels of pollution emitted from VW diesel cars.

Source(s): Reuters