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Court Says Porsche Can’t be Sued by U.S. Investors
An appellate court in New York City has ruled that Porsche Automobil Holding SE cannot be sued in the U.S. by hedge funds that claim the holding company misled them in 2008 about its effort to take control of Volkswagen AG.
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An appellate court in New York City has ruled that Porsche Automobil Holding SE cannot be sued in the U.S. by hedge funds that claim the holding company misled them in 2008 about its effort to take control of Volkswagen AG.
The court upheld a lower court ruling nearly four years ago that dismissed lawsuits accusing Porsche SE of securities fraud. Plaintiffs say the company lied about targeting VW even as it amassed control of 74% of the company's shares.
When the holding company announced its stake, VW's share price soared. Hedge funds that had bet on the stock price falling claimed they lost more than $2 billion (€1.5 billion) in one week.
The takeover attempt left Porsche SE awash in more than €10 billion in debt, prompting it to sell its Porsche AG sports car company to VW. So far the holding company has successfully overcome fraud charges in both the U.S. and Europe.