Monday, 14 March 2016

Update VW case

The "lawsuit tourism" - or rather forum shopping - by German consumers to the Netherlands continues. After initially an action was instigated for German (and Austrian) consumers  - see link - now a second foundation was founded in the Netherlands that seeks to negotiate with VW on behalf of the investors: Stichting Volkswagen Investor Settlement.
For these two groups of harmed individuals the German system does not seem to be sufficiently equipped to provide collective redress. While there is no such thing as collective actions for consumer damage claims, the German legal system actually knows a test case procedure (Musterfeststellungsklage) for certain investor protection cases. The procedure was enacted in 2005 to deal with a large number of cases brought by harmed investors against Deutsche Telekom. It has been reformed since. The Telekom case has not been concluded yet, which is some prima facie evidence of the doubtful effectiveness of the procedure. According to recent news threads, VW wishes to use this procedure to deal with the claims of German investors. 

Let the German and Dutch procedures compete!

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