(FILE) Volkswagen CEO Martin Wintekorn
Volkswagen doesn't know whether Winterkorn read all of his e-mail. Photograph by Sean Gallup — Getty Images

Volkswagen hires BP’s Deepwater defense team as the lawsuits start

Sep 23, 2015

Here's an action that speaks volumes.

Beleaguered German car giant Volkswagen AG (vlkpy) has hired the lawyers used by BP Plc (bp) to defend it after the Deepwater Horizon disaster, as it prepares to face the consequences of its deliberate deception of regulators and consumers over the environmental performance of its diesel engines.

Bloomberg News reported that the company has retained Kirkland & Ellis LLP to help it deal with the widening scandal, citing a spokesman for the Wolfsburg-based group. It isn't clear who will be lead partner at the firm for the VW account.

VW faces a maximum fine from U.S. authorities of as much as $18 billion for having fitted its cars to give misleading data on emissions in mandatory tests. It's under investigation in a number of other countries across the world, from its home market in Germany to South Korea and Australia.

In addition, there is the likelihood of private lawsuits: at least one law firm, San Francisco-based law firm Girard Gibbs LLP, has already launched a class action. Girard Gibbs filed its case Tuesday in the U.S. District Court for the Northern District of California "to hold the auto manufacturer accountable for its unlawful conduct that tricked environment-conscious consumers to purchase “clean diesel” vehicles that tested as low emission but in reality did little to protect the environment from air pollution."

For every one U.S. driver that feels tricked, there may be as many as 20 in other countries. The company admitted Tuesday that 11 million of its vehicles worldwide run the software that cheated the emissions testers.

Back in Germany Wednesday, CEO Martin Winterkorn is set for a grilling by a five-man sub-committee of the group's board. The full board is due to meet on Friday and is likely to discuss Winterkorn's fate. The company dismissed as "nonsense" Tuesday a German press report claiming that it would fire Winterkorn on Friday.

Winterkorn himself issued a statement Tuesday that gave no hint of resignation and appeared to imply that others beneath him were responsible for the scandal, saying "At this moment, I don't have the answers to all the questions."

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