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Thursday, July 25, 2024 | Back issues
Courthouse News Service Courthouse News Service

U.S. Judge Fuels Porsche in $1.4B German Fight

MANHATTAN (CN) - New York-based hedge funds must cough up evidence that could show they were too slow to file a $1.4 billion lawsuit against Porsche near its German headquarters, a federal judge ruled.

Dozens of hedge funds accused Porsche last year of manipulating the market about the company's Volkswagen investments in 2008.

Earlier that year, Porsche denied plans to take over fellow German manufacturer VW, even though it revealed later in 2008 that it controlled 74.1 percent of the company's common stock, Reuters reported.

This amount reportedly marked a fraction of a percentage below the 75 percent takeover threshold.

While Porsche tried to outrace its German liabilities, the Stuttgart-based auto giant turned to Manhattan Federal Court to dig up information on three of their hedge fund opponents.

Specifically, Porsche hoped to prove their hunch that New York-based hedge funds Marble Arch, Firefly and Tremblant knew about their well-publicized VW investments more than three years before bringing the German litigation.

If true, the evidence would help Porsche dismiss the lawsuit under Germany's statute of limitations.

U.S. District Judge Lewis Kaplan gave Porsche the green light to seek that evidence on Thursday. Powering up Porsche's defense, he said, was a matter of international judicial hospitality.

"That hospitality derives from Congress's desire to make the United States a helpful world citizen and, moreover, in the hope of obtaining similar receptivity abroad to efforts by litigants in American courts to obtain evidence located in other countries," the 30-page opinion states.

Marble Arch, Firefly and Tremblant must prepare witnesses for deposition by early March.

Porsche's attorney, Robert Giuffra Jr. of Sullivan & Cromwell LLP, told Courthouse News, "We're pleased with Judge Kaplan's decision."

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