Just last week, Volkswagen was indicted by the German courts again. The charge? The prosecution claimed that the German automaker manipulated stock market prices by failing to inform their investors ahead of time over the dieselgate emissions scandal.
Unlike that case, Volkswagen isn't taking this one sitting down. In fact, they released a statement calling the latest indictment as 'unfounded'. There, the company hit back by saying, 'the charges made against Volkswagen are unjustified', and 'the allegations of a possible breach of reporting obligations under capital markets law are unsubstantiated'.
The courts say that the automaker waited too long to tell investors regarding misconduct on emissions. Prosecutors also allege that chairman Hans Dieter Poetsch, former CEO Martin Winterkorn, and even current CEO Herbert Diess, held a meeting to discuss the emissions scandal prior to admitting it once the United States Environmental Protection Agency (EPA) released their findings.
Volkswagen believes that they were under no obligation to inform the capital market regarding the matter, right up until the U.S. EPA published a “Notice of Violation” on September 18, 2015. They added that they did not foresee the subsequent financial consequences of the whole diesel debacle before the said date.
The company's lawyers repeatedly reviewed the facts of the case and compared theirs with other automakers faced with the same dilemma. According to Volkswagen, the legal team concluded that the financial consequences were below the company's requirements to inform the stock market at the time. They added that the cases filed in the United States, along with the fines imposed by the U.S totally changed Volkswagen's strategy following their admission.