Sunday, 26 June 2016
Last updated 1 day ago
Mar 17 2014 | 12:52pm ET
Just a month after casting a skeptical eye at one of the hedge fund lawsuits against Porsche Automobil Holding, a German judge has thrown out the complaint.
Judge Carola Wittig in Stuttgart dismissed a €1.36 billion lawsuit filed by two dozen hedge funds, which accused Porsche of manipulating the market in Volkswagen by secretly buying a majority stake in the rival automaker before announcing plans to acquire it. But while two former Porsche executives are facing criminal charges over the alleged manipulation, Wittig found that it could not be proved that Porsche deliberately harmed the hedge funds’ positions.
Wittig said last month that she saw “considerable litigation risks for the plaintiffs” due to “a whole series of obstacles that need to be overcome”—and apparently could not be.
The plaintiffs behind the dismissed lawsuit include Glenhill Capital, Greenlight Capital and Viking Global Investors. Other hedge funds have separately sued Porsche, including Elliott Management—lawsuits that could face a similar fate.
The Greenlight-Viking group would not say whether they will appeal, although it appears likely.
The hedge funds last year agreed to move their litigation against Porsche to Germany, after both New York State and U.S. federal courts ruled that they had no jurisdiction.