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Volkswagen faces $3.7 billion investor lawsuit over diesel emissions scandal

The fallout continues

Harold Cunningham/Getty Images

Volkswagen is facing a €3.3 billion ($3.7 billion) lawsuit from investors who claim that the German automaker took too long to disclose information about its diesel emissions scandal. The lawsuit was filed Monday in Braunschweig Regional Court, Bloomberg reports, marking the steepest legal challenge that VW has faced in Germany since news of the scandal first broke.

Lawyer Andreas Tilp, who filed the suit on behalf of 278 institutional investors, tells Bloomberg that legal action was necessary because "Volkswagen persistently denies any settlement negotiations and also refuses to waive the statute-of-limitation defense until now." A VW spokesman said the company was not familiar enough with the lawsuit to provide comment.

VW has admitted to installing special software that allowed some of its diesel cars to cheat on emissions tests, and it has vowed to issue technical fixes to bring existing models in line with environmental regulations. The automaker is facing several lawsuits over the scandal in the US, and there are 65 related cases pending in the Braunschweig court, Bloomberg reports. VW is also facing criminal probes in several countries. The action filed Monday was on behalf of investors from around the globe, including German investment companies, insurance firms, and the California Public Employees’ Retirement System.