BRAUNSCHWEIG (dpa-AFX) - Investor litigation - for Volkswagen, this is perhaps the final trigger for unease at the Wolfsburg headquarters following the diesel scandal. More than ten years after the emissions manipulation was uncovered, the outcome of these proceedings could still prove extremely costly. Investors are seeking compensation for losses and are demanding billions. After a long hiatus, hearings are set to resume this Tuesday and Wednesday.
What is the trial about?
In this model case, shareholders are seeking billions of euros in damages. However, the trial is not about the fraud itself. Rather, the pivotal question is: Did VW inform the markets in a timely manner about the scandal involving millions of manipulated diesel engines?
Immediately after the scandal broke in late September 2015, VW's share price collapsed - at times, the group's preferred shares lost nearly half of their value. Investors continue to seek compensation for these losses to this day.
Model proceedings - what does that mean?
The trial does not examine the criminal conduct of individuals. It is a civil proceeding in which significant sums of money are being contested in the form of damages. While such cases usually involve two opposing parties, the Capital Investor Model Proceedings Act (KapMuG) allows for an exception.
In a model trial, numerous parallel proceedings can be bundled to reach a uniform decision. Currently, around 2,000 suspended initial proceedings involving approximately 3,400 plaintiffs are pending.
The proceedings at the Higher Regional Court of Braunschweig are intended to culminate in a model ruling. Once this becomes legally binding, the findings are binding for the courts of all suspended proceedings.
Who are the litigants in court?
The Braunschweig civil senate has designated Deka Investment GmbH as the model plaintiff. The model defendants are Volkswagen AG and VW's majority shareholder, Porsche SE. While Volkswagen has attempted to appear detached in light of the numerous criminal trials and prison sentences handed down to former group managers, such a stance is not possible for these proceedings. The claims for damages are directed against both the automaker and Porsche SE.
Is this still relevant after so much time?
The trial is significant primarily because of the vast sums involved. The Higher Regional Court of Braunschweig currently estimates the value in dispute at approximately 4.3 billion euros. According to industry expert Helena Wisbert, Professor of Automotive Economics at Ostfalia University in Wolfsburg, the outcome is relevant for VW because it involves potential payments and settlements for which financial provisions weigh on the balance sheet.
According to its own figures, the fallout from the scandal has already cost the VW Group more than 32 billion euros. In the worst-case scenario, the company would face a further multi-billion euro shortfall for future investments.
What are the plaintiffs' arguments?
The plaintiffs argue that the VW board was aware by 2007 at the latest that strict US nitrogen oxide emission standards could not be met. Subsequently, VW engaged in fraud - and because investors were unaware of this, they purchased shares at significantly inflated prices.
The model proceedings in Braunschweig have allegedly shown that the board, including then-CEO Martin Winterkorn, knew from a so-called 'high-level meeting' in November 2007 that VW was unable to produce compliant diesel vehicles.
'The relevant documents for this meeting, particularly the presentation given there, contain, in our conviction, unambiguous indications of the planned use of illegal defeat devices,' says plaintiffs' attorney Axel Wegner.
How do the defendants respond?
They deny the allegations. In a statement of defense prior to the start of the proceedings, VW emphasized that, from the group's perspective, there were no concrete indications that the scandal would be price-sensitive until US environmental authorities unexpectedly went public with their allegations on September 18, 2015.
'Volkswagen AG is convinced that it has fulfilled its information obligations under capital market law at all times,' says a group spokesperson. The assessment from Stuttgart is almost identical: 'Porsche SE is convinced that it has complied with its disclosure obligations under capital market law at all times,' a spokesperson there stated.
After nearly eight years of litigation, no one at VW feels compelled to deviate from this view. 'Against the backdrop of the ongoing taking of evidence and the witness examinations to date, we feel confirmed in our conviction,' says the group spokesperson.
Why are the proceedings taking so long?
As early as 2020 - after two years of hearings - a spokesperson for the Higher Regional Court stated that no end was in sight for the complex and extensive proceedings. At the time, she spoke of around 5,500 pages of files, numerous exhibits, and 21 private expert opinions.
In 2023, the court announced it would conduct an evidentiary hearing, calling around 80 witnesses and reviewing a vast number of documents. The witness list included the names of former VW CEOs Martin Winterkorn, Matthias Müller, and Herbert Diess.
According to a court schedule, 63 witnesses and three parties were examined between September 2023 and September 2025. Adding to the difficulty of evaluating the testimonies is the fact that several scheduled witnesses invoked what they considered to be a comprehensive right to refuse testimony.
Is a decision imminent?
Further witness examinations are expected during the two sessions this week. Of particular interest could be the testimony of Wolfgang Hatz, the former Audi engine chief whose conviction is now legally binding.
All parties involved are also hoping for an assessment from the judges regarding what the evidence has yielded so far and how the trial should proceed. However, the model ruling remains unpredictable for the foreseeable future./bch/DP/zb
