German Court Orders Independent Probe of VW Diesel Cheating

A German regional court has ruled that an independent auditor must be appointed to lead a new investigation into Volkswagen AG’s diesel emission cheating.

The decision by the Lower Saxony appellate court in Celle opens the likelihood of new information being revealed about the scandal. Investor lobbying groups DSW and SdK declare the ruling a major victory in their effort to force the company to reveal details about who knew what, and when, in the scandal.

U.S. regulators announced two years ago that VW had doctored engine software to activate emission controls only when a vehicle is undergoing emission tests. VW eventually acknowledged the cheating and agreed to recall some 11 million affected vehicles worldwide.

VW has since spent some $27 billion (€23 billion) on fines, remediation and repairs—most of it in the U.S. to address about 555,000 rigged diesels.

VW hired U.S. law firm Jones Day and consultants Deloitte two years ago to conduct an independent probe into the cheating. The company vowed to release a report on the findings but changed its mind and issued a short summary instead.

A new investigation would attempt in part to reveal exactly when VW’s top management learned of the cheating and whether those executives alerted investors in a timely fashion as required by German law.