Porsche, Piech sued in Frankfurt by hedge funds over failed Volkswagen deal

Ferdinand Piech, left, and his cousin Wolfgang Porsche are pictured on the eve of the 2013 Frankfurt auto show.

Photo credit: Reuters
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DUSSELDORF (Bloomberg) -- Seven hedge funds sued Wolfgang Porsche and Ferdinand Piech, members of Porsche Automobil Holding SE's supervisory board, seeking 1.8 billion euros ($2.4 billion) of compensation over the aborted purchase of Volkswagen Group in 2008.

The funds brought a civil action against Porsche, the board chairman, and Piech, Volkswagen's chairman, at Frankfurt Regional Court, Porsche SE said on Sunday in a statement.

The company said it will contest the suit, describing it as being without merit.

Porsche has faced a series of legal actions since disclosing in October 2008 that it controlled 74.1 percent of Volkswagen, partly through options, and was seeking to acquire 75 percent and eventually take it over. The announcement caused Volkswagen's stock to jump as short sellers raced to buy shares to repay borrowed stock in bets that VW would fall.

Volkswagen now controls the Porsche brand.

Porsche SE has so far been successful in defending against allegations it manipulated Volkswagen shares.

The company ended most related U.S. litigation by winning a bid to have the cases moved to Germany. In July 2013, the company won a ruling in an effort to block a new legal claim in the U.K.

The Porsche statement, which didn't name the hedge funds, followed a report in the German magazine Spiegel that Elliott Associates LP was among those that filed the civil suit.

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