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Porsche Shareholder Action

Proposed Shareholder Action Against Porsche Automobil Holding SE

Innsworth is contemplating funding proceedings against Porsche Automobil Holding SE (Porsche SE) on behalf of shareholders who have acquired shares in the indicative period 1 January 2009 to 18 September 2015.
Porsche SE is a holding company, which through its subsidiaries, including Volkswagen AG, offers development, production, and sale of automobiles along with financial services. Its shares are traded on all German Stock Exchanges under ticker PAH3 GR.

Legal Action Background

The proposed action against Porsche SE is intrinsically linked to the ongoing claim against Volkswagen AG. In this case, the shareholder action was brought in the wake of the Volkswagen emissions scandal. It emerged via US environmental agencies in late September 2015, that Volkswagen had allegedly installed “defeat devices” in certain vehicles. This was subsequently formally admitted by senior Volkswagen executives. It would subsequently emerge, that the emission scandal was not confined to the US alone, and that millions of affected vehicles had been sold worldwide. The stock market had reacted negatively and, following the immediate disclosure, the price of Volkswagen securities fell sharply, wiping out some €25 billion of Volkswagen’s market capitalisation.
An action was brought by the aggrieved shareholders asserting that Volkswagen failed to inform the market of the use of “defeat devices” for at least five years, and possibly longer, and that this information constitutes inside information under the relevant German legislative provisions and should have been immediately released to the market.

Potential claim against Porsche SE

Porsche SE is the ultimate holding company of Volkswagen AG, holding 52.2 % of the
ordinary voting stock. Following the unveiling of the Volkswagen emission scandal, the price of Porsche SE shares fell up to 25% in the upcoming days.

Although Porsche SE is not involved in the operational business of Volkswagen AG, a recent referral decision by the Stuttgart District Court, suggests that holding companies, such as Porsche SE, may be subject to the same disclosure obligation as their subsidiaries. Therefore, the claim is that Porsche failed to give disclosure to the capital market. Briefly, it will be contended: (a) that Porsche SE as a holding company is not automatically exempt from issuing ad-hoc notices and therefore ought to have published ad-hoc notices about the events of the Volkswagen emission scandal, (b) that the Volkswagen emission scandal is ‘issuer-relevant’ information under the German Law triggering disclosure obligations, and (c) Porsche SE was liable to disclose broad information.

For obtain further information, please call us on +44 (0)20 3750 1300 or email your query to client.operations@innsworth.com

Documents
Porsche SE – FAQs