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U.S. Court Dismisses Porsche Fraud Lawsuit
Porsche Automobil Holding SE prevailed in arguing that a fraud lawsuit filed in New York by 26 hedge funds should be rejected because the U.S. has no jurisdiction.
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Porsche Automobil Holding SE prevailed in arguing that a fraud lawsuit filed in New York by 26 hedge funds should be rejected because the U.S. has no jurisdiction.
A five-judge panel of the New York State appeals court agreed unanimously on Thursday that the complaint cannot be pursued in the U.S. because the holding company's activities involved transactions conducted on foreign exchanges.
The lawsuit accused Porsche SE of illegally misleading investors in 2008 by denying it was attempting to gain control of Volkswagen AG. When Porsche's plan to the contrary became public, VW shares briefly surged in value. Hedge funds, who had bet on a decline in VW's stock price, claimed they lost more than $2 billion in one week.
Two similar lawsuits were rejected early last year by a federal judge in New York. That judge cited a U.S. Supreme Court ruling that American courts many not adjudicate claims involving transactions made on foreign exchanges.
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