Despite court win, Porsche faces more VW lawsuits

Article by Christian A., on January 3, 2013

After the U.S. lawsuit filed by 26 hedge funds against Porsche SE was dismissed, the automaker’s shares rose on Friday. This is just one of several legal actions over its purchase of shares in Volkswagen, the biggest automaker in Europe. Porsche’s preferred shares in Germany went up by 6.3% to 61.70 euros, the highest price reached since January 2011.

However, analysts cautioned that Porsche’s win in court centered on a legal formality instead of the substance of the case. Last Thursday, a five-justice panel of the New York State appeals court in Manhattan determined that the state was the wrong place for the lawsuit to be filed.

So now, the hedge funds have 30 days to make a decision on whether they will pursue the lawsuit in New York's highest state court, the Court of Appeals. DZ Bank analyst Michael Punzet said Porsche still faced other lawsuits that remain pending. He explained that the ruling was based on the jurisdiction and not the claim itself.

There is still a pending $2 billion lawsuit by other hedge funds in a U.S. federal court. Porsche has so far not released a statement about its triumph in court. Previously, Porsche had said that the hedge funds' lawsuits are without factual and legal merit. Prosecutors in Stuttgart (which is Porsche’s headquarters) divulged last week that market manipulation charges against former Chief Executive Wendelin Wiedeking and former CFO Holger Haerter were tied to VW share purchases.

The lawyers of these defendants have denied that their clients committed any wrongdoing. The New York State appeals court had dismissed the case filed by hedge funds (which include Glenhill Capital LP, David Einhorn's Greenlight Capital LP and Chase Coleman's Tiger Global LP) that claim that Porsche caused over $1 billion of losses by cornering the market in VW shares.

The funds said that Porsche had made a public announcement that it didn’t have any plans to take a 75% stake. However, the funds stated that Porsche created a "massive short squeeze" in October 2008 by secretly purchasing almost all freely traded ordinary VW shares as it tried to take over the company.

Topics: porsche, vw, lawsuit

If you liked the article, share on:

Comments

Recommended

For many years, Lamborghini has always relied on the use of large and powerful engines including the V10 and the V12. In fact, the company’s very first engine in the...
by - October 17, 2017
You can now get the Opel Crossland X that’s LPG-powered if you are not a fan of diesel. Recently, the company released their version of the Peugeot 2008 equipped with...
by - October 17, 2017
As seasons change, temperatures rise and fall. The changes affect our preferences when it comes to driving cars. Therefore, Aston Martin introduces the new DB11 Volante or convertible, and it...
by - October 16, 2017
Aston Martin may be known for building many of the stylish Bond cars we see on the big screen but nobody really knew how it can get super aggressive when...
by - October 16, 2017
Today, manual transmissions have become rare in mainstream cars and are more commonly found in performance cars within the $20,000 to $40,000 range. However, the selection of affordable, three-pedal performance...
by - October 16, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries