New York (HedgeCo.Net) – Porsche has won a case in the US appeals court put forward by a group of over 30 hedge funds led by Greenlight Capital, Elliott International and Perry Partners, who tried to sue the carmakers for 1.81 billion euros (approximately $2.4 billion), Reuters reports.
The news source said: “The 2nd U.S. Circuit Court of Appeals on Friday [Aug. 15] said Porsche’s alleged wrongdoing was “so predominantly foreign” that it could not be held liable in U.S. federal courts under domestic securities fraud laws. It also said that the hedge funds might still “conceivably” show that U.S. laws should apply, and try to amend their lawsuit in Manhattan federal court.”
Porsche’s headquarters were raided in 2009 during investigations into allegations revolving around the failed takeover of Volkswagen, during which Porsche took large positions in VW stock. Prosecutors allege that inside information was leaked in pursuit of the failed bid. Porsche denied any disclosure irregularities but many hedge funds and investment management firms sued anyway.
German regulator BaFin dropped its initial investigation but re-opened it after claims that the incident was bringing the entire German stock market into disrepute.
A US federal judge dismissed a lawsuit by a group of 10 hedge fund in 2011 and a New York State appeals court dismissed a lawsuit brought by hedge funds against Porsche back in January of this year. A total of 24 funds have now withdrawn their appeal of an earlier court decision dismissing the case.
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