November 30, 2015 / 8:39 PM / 2 years ago

Volkswagen, DOJ want diesel civil cases heard in Detroit

WASHINGTON (Reuters) - Volkswagen AG (VOWG_p.DE) and the Justice Department want a U.S. judicial panel to centralize in Detroit hundreds of civil lawsuits alleging the German automaker defrauded consumers and shareholders, according to court filings.

A logo of Volkswagen is seen on a Golf car parked at a dealership in Seoul, South Korea, November 25, 2015. REUTERS/Kim Hong-Ji

The U.S. Multi-District Litigation panel will hold a hearing Dec. 3 in New Orleans to determine if and where to consolidate more than 350 lawsuits that stem from the automaker’s admission in September that it installed illegal software in nearly 500,000 vehicles to circumvent U.S. diesel emission tests.

Lawsuits have been filed in more than 40 U.S. states. Earlier this month, U.S. regulators also said VW installed “defeat devices” to cheat emission standards in 85,000 larger cars and SUVs.

The judicial panel routinely consolidates major civil litigation in order to speed cases and avoid duplication of efforts. Consolidating cases allows for joint document requests and witness depositions.

Volkswagen wants the judicial panel to create two tracks of cases: one for suits filed by owners of diesel vehicles and another for five securities lawsuits filed by pension funds and others who invested in VW by purchasing American Depositary Receipts that trade over the counter.

One securities lawsuit says U.S. investors lost “hundreds of millions of dollars” as the value of ADRs declined by 33 percent after the scandal became public. For instance, the Arkansas State Highway Employees Retirement System -- one pension fund suing VW -- says it lost $1.7 million on VW investments.

In a Nov. 24 court filing, VW lawyer Robert Giuffra said the automaker wants the cases heard by Chief U.S. District Judge Gerald E. Rosen in Detroit.

But VW said if the panel thinks that is “too burdensome” for one judge to hear both types of cases, than the securities cases should be assigned to U.S. District Judge Liam O‘Grady in Alexandria, Virginia.

Separately, the Justice Department, which is conducting a criminal investigation into VW’s diesel emission cheating, also wants the civil cases heard in Detroit, noting government testing labs are in nearby Ann Arbor and VW has engineering offices in Auburn Hills, Michigan.

The Justice Department filed new documents under seal with the panel last week, outlining additional undisclosed reasons why the case should be heard in Detroit.

Many lawyers suing VW want the cases heard in central California, noting the state’s Air Resources Board is also investigating VW diesel problems, along with the government regulators in Washington D.C.

Reporting by David Shepardson in Washington; Editing by Andrew Hay

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