Former VW Executives Ordered to Testify in Investor Lawsuit

A German court will call former Volkswagen AG executives as witnesses in a €9 billion ($9.8 billion) investor lawsuit over the diesel emissions scandal to find out what the top brass knew about the the so-called defeat device used in diesel cars to sidestep emissions tests.

Among the 86 witnesses to be called is Martin Winterkorn, VW’s former chief executive officer, a spokeswoman for the Higher Regional Court of Braunschweig said by phone. The witnesses come from all levels of VW’s management, she said. The judges on Friday [July 7] also ordered the disclosure of numerous documents.

A VW spokesman said the ruling was expected, adding that the carmaker still considers the claims to be unfounded.

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The tribunal in 2021 gave investors a boost when it said Europe’s largest carmaker may be liable for not telling the markets about the defeat device if top management knew about it. Any investors seeking damages for losses up until July 9, 2012 have to prove that the management board knew about the deceit, the court ruled at the time. From that date onward, VW has to prove its executives didn’t intentionally or negligently fail to disclose that information.

Ever since the scandal broke in 2015, VW’s main line of defense has been to blame a small group of engineers that it said colluded to rig the software and hid their tricks from company leadership.

Winterkorn has been charged over the scam but his trial hasn’t yet started due to health issues. Since he’s a suspect in a criminal case, he can decline to testify in court, making it unlikely that he will show up in the investor suit. Other witnesses under investigation may also invoke these privileges.

The case is Deka Investment GmbH v. Volkswagen AG and Porsche Automobil Holding SE (3 Kap 1/16).

Photograph: Former VW CEO Martin Winterkorn; photo credit: Rolf Schulten/Bloomberg

Topics Lawsuits