The first law suit against Volkswagen has been filed in Germany on behalf of hundreds of institutional funds seeking damages resulting from the emissions scandal.
Claims are thought to run into billions of pounds.
Law firm Quinn Emanuel has filed the first of two law suits for shareholders said to have lost “hundreds of millions of euros” due to the loss of share value in the week after VW disclosed its use of defeat device software in its diesel vehicles in September.
The shareholders include sovereign wealth funds and international asset managers, public pension funds, multinational company pension plans and foundations.
And in addition to the funds that are currently participating, litigation funders Bentham Europe is in discussions with a “very large number” of additional funds and international asset managers.
Jeremy Marshall, chief investment officer of Bentham Europe, said on the filing of the suit: “The filing represents the culmination of the work of many months but is merely the first step in the campaign.
“We have been struck throughout by the depth of feeling that exists against Volkswagen’s admitted practices and its recent reaction to its self-inflicted crisis.
“The breadth of the shareholder base that is represented by Quinn Emanuel should be a wake-up call to Volkswagen AG that it needs to engage with shareholders now, resolve matters and concentrate on regaining its market share."
Dr Nadine Herrmann, the managing partner of Quinn Emanuel's Hamburg office who is leading the suit in Germany, said: "Our clients in this litigation are serious investors who care deeply about good corporate governance and functioning capital markets.
“If there ever was a corporate scandal where courts must vindicate the information rights of capital market investors it is this one and we are confident that we will convince the courts to award the damages our clients are justly owed."
The views of the shareholders are best summed up by Brian Bartow, general counsel and chief compliance officer of the California State Teachers’ Retirement System (CalSTRS), who said, on filing: "Companies must be held accountable when they engage in such widespread deliberate deceit which destroys shareholder value, damages their reputation and harms the public.
“As a long-term shareholder, CalSTRS has serious concerns about Volkswagen’s internal controls, governance and oversight by the Board. This action seeks to recover not only CalSTRS’s economic losses to the pension fund, but, ultimately, to implement much needed corporate governance reforms going forward at Volkswagen."
The litigation in Germany funded by Bentham will proceed in two waves. The second wave will be filed over the next three months and will be filed on behalf of a larger group of asset managers and investors. Quinn Emanuel will shortly be filing a model case application on behalf of the investor group. Other steps in the litigation will be taken over the next few days.