FRANKFURT â€" The former holding company for the automaker Porsche won a victory Monday in its long-running legal battle with a group of aggrieved hedge funds, after a judge in Stuttgart dismissed a suit seeking damages over events leading up to its unsuccessful attempt to acquire Volkswagen.
A group of 23 hedge funds had been seeking 1.36 billion euros, or $1.89 billion, in damages from Porsche Holding over what the funds said were misleading statements made by company executives before the attempt in 2008 to acquire Volkswagen. Volkswagen eventually agreed in 2012 to acquire all of Porsche after discussions began in 2009.
The decision was the latest in a series of court victories by Porsche Holding against hedge funds that lost billions betting against Volkswagen shares. Among the hedge funds is Greenlight Capital, whose president, David Einhorn, is a prominent short-seller and critic of corporate behavior. A spokesman for Mr. Einhorn declined to comment.
The decision on Monday is hardly the end of the courtroom battle on two continents that followed Porsche’s audacious bid to take over its much larger cousin. Numerous court proceedings remain open in several German courts as well as the United States.
“This is an important stage victory,†Porsche Holding said in a statement.
Carola Wittig, a judge in the state court in Stuttgart, ruled that Porsche managers had not committed misconduct when they denied plans to try to take over Volkswagen in early 2008, only to initiate just such an acquisition bid in October of the same year.
Companies do not have a right to lie to shareholders, Judge Wittig ruled, but Porsche was not obligated in early 2008 to disclose its intention to acquire VW shares or its purchase of options on VW stock. “It was hardly possible to react to public speculation about a takeover of VW except with a denial,†the Stuttgart court said in a statement explaining the decision.
Porsche Holding, the target of the lawsuit, no longer has direct operative control over Porsche auto production. But it is the largest shareholder in Volkswagen, with just over half the voting shares and 32 percent of the total equity in the carmaker, Europe’s largest.
The four-person supervisory board of Porsche Holding includes Martin Winterkorn, the chief executive of Volkswagen, and Matthias Müller, chief executive of the Porsche unit.
The histories of Porsche and Volkswagen have long been intertwined. Ferdinand Porsche designed the original Volkswagen Beetle in the 1930s, and in subsequent years the sports car maker and its larger cousin often cooperated closely on development and production of vehicles. Ferdinand Piëch, the chairman of the Volkswagen supervisory board, is a grandson of Ferdinand Porsche.
Porsche Holding has already won a favorable ruling in federal court in the United States, which some of the hedge funds are appealing. Legal proceedings related to the takeover attempt remain open in courts in Braunschweig, Germany, as well as Hannover and Frankfurt.
