Hit taken as share price plunged post-dieselgate.
The German state of Bavaria has announced it intends to sue Volkswagen Group over losses suffered by the state pension fund in the wake of the dieselgate emissions cheating scandal, according to a report by Reuters.
A spokeswoman for the Bavarian finance ministry said the fund had taken a €700,000 ($779,000) hit on its 58,000 shares in VW, when share prices plunged last September after the automaker admitted cheating U.S. emissions tests.
“We want this money back,” Bavarian Finance Minister Markus Soeder told German news agency Deutsche Presse-Agentur (DPA). Soeder added that the lawsuit would be filed in September, in VW’s home state of Lower Saxony.
Lower Saxony itself is the second largest shareholder in VW and has seats on the board with power of veto.
There is doubt within the Lower Saxony government about the veracity of Bavaria’s ‘suit, however. Finance Minister Peter-Juergen Schneider said: “Bavaria is a strategic investor [in VW]. Trading with shares was not and is not intended. Therefore, it’s questionable whether a potential violation of ad-hoc rules even caused material damage.”
It isn’t clear at this point if Bavaria will simply claim for losses, or that violations by VW caused financial damage.
Porsche's home state of Baden-Wuerttemberg, which holds 65,000 shares, is reportedly also contemplating launching legal action.
Volkswagen has not commented.