German court dismisses two VW law suits against Porsche

 
City A.M. Reporter
RMAN

RMAN regional court has stopped two investor lawsuits against Porsche, sending a discouraging signal to claimants still seeking just over €4bn (£3.2bn) in damages.

Presiding judge Stefan Puhle at the court in Braunschweig read out the decision yesterday without giving reasons.

Some German and US investors say that throughout 2008 Porsche camouflaged its plans to acquire VW and instead secretly piled up its holding.

In March 2008, the sportscar maker dismissed as “speculation” talk that it intended to take over the much-bigger VW, which builds more cars in a week than Porsche does in a year. Seven months later, Porsche said it controlled 42.6 per cent of VW’s common shares and held options for another 31.5 per cent of the stock it had not disclosed previously.

Porsche’s statement caused VW shares to surge to €1,005 within days, briefly making the carmaker the world’s most valuable company as short-sellers raced to buy back stock they had borrowed to bet that VW shares would drop.

Swiss investment company My Capital-MC and a German private investor, champions of the two failed lawsuits, had sought compensation for €4.7m of losses from short-selling VW shares.

Porsche spokesman Albrecht Bamler welcomed the court’s decision, saying the Stuttgart-based company would fight the three outstanding lawsuits “with all rigor”.

Hearings of the pending cases have yet to be scheduled.