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Volkswagen admitted in 2015 to cheating U.S. diesel engine tests, sparking the biggest crisis in its history and costing the company more than 32 billion euros ($38 billion) in vehicle refits, fines and legal costs so far.
The scandal has been traced back to 2008, around when Volkswagen started using software to control diesel engine emissions that was later ruled illegal when discovered by U.S. regulators.
Whether investors can claim compensation for the plunge in Volkswagen’s share price after the scandal was exposed depends on whether it can be proven that any member of the company’s executive board was aware the plan constituted cheating, the higher regional court in Braunschweig said on Thursday.
The test case was brought against Volkswagen and its controlling shareholder, Porsche Automobil Holding SE, by fund manager Deka Investment GmbH.
The Braunschweig court said for the time before July 9, 2012, due to a statute of limitations, it was up to the plaintiffs to prove that a Volkswagen board member knew the plan was cheating.
For the time since that date, Volkswagen has to prove that management’s failure to make a statement in 2008 was neither deliberate nor grossly negligent.
The parties have time until the end of January to comment on the court’s preliminary conclusion and to provide evidence on what knowledge management had, the court said.
Volkswagen had no immediate comment.
