Volkswagen will no longer publicly release an interim report about the diesel investigation from law firm Jones Day. In a statement, the German automaker cited "unacceptable risks" as a reason for not publishing the information, despite previously saying it would issue the documents by the end of April. The company's two US law firms advised it that releasing the data could hamper negotiations with the US Department of Justice.

According to VW, the company needs "to maintain the highest degree of confidentiality" while negotiating with government offices, including Environmental Protection Agency, California Air Resources Board, Federal Trade Commission, Attorneys General from 50 states, and the DOJ. Money also plays a role because the information in the report might "jeopardize the credit that Volkswagen may expect to receive in the event of its full cooperation with the Department of Justice," which could "have very substantial negative financial consequences." In addition, the company has concerns that the data could allow workers not yet interviewed by Jones Day to make their statements fit with the report.

VW hired Jones Day in late September 2015 to conduct the investigation. So far, the firm has collected 65 million documents and conducted 450 interviews. Recent reports have hinted at problems with the detective work because VW allegedly used dozens of code words to hide the emissions cheating. The lawyers don't expect to finish the full report until the fourth quarter of 2016.

Late last week, VW reached a tentative agreement with the court to buy back affected diesel vehicles in the US and establish funds to clean up the environment. The arrangement could cost the automaker billions. Final details of the plan are due on June 21.

Don't expect to hear any official details about exactly what caused the diesel scandal until the DOJ and VW reach a settlement. The German automaker previously promised to release an interim report about the investigation at its annual press conference on March 10. VW then pushed back the date to the shareholders meeting on April 21. At the time, the company said the delay was "due to remaining open questions and the resulting valuation calculations relating to the diesel emissions issue."

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Statement by Volkswagen AG regarding the status of the comprehensive investigation in connection with the diesel matter

At the end of September 2015, the Supervisory Board of Volkswagen Aktiengesellschaft assigned law firm Jones Day with a comprehensive investigation in connection with the diesel matter. This investigation is already far advanced and is being pursued intensely. For this purpose, approximately 65 million documents were submitted for electronic review, of which more than 10 million were forwarded for review by Volkswagen's lawyers. Around 450 interviews have also been conducted about the diesel matter; dozens of additional interviews are planned. Based on the current assessment, Jones Day expects the investigation to conclude in the fourth quarter of 2016.

After a thorough examination of the legal situation, the Supervisory Board and the Management Board of Volkswagen have nevertheless had to recognize that a disclosure of interim results of the investigation at this point in time would present unacceptable risks for Volkswagen and, therefore, cannot take place now. This decision is based on the assessment of the U.S. law firms retained by Volkswagen (Sullivan & Cromwell and Jones Day), which have both strongly advised against such a disclosure independently of each other.

Volkswagen regrets that it has had to move away from the original plan to disclose interim results of the investigation by the end of April. The reasons lie in the following developments in proceedings involving Volkswagen in connection with the diesel matter in the United States:

Volkswagen's complex negotiations with a large number of parties in the United States (including private plaintiffs and multiple U.S. regulators, including the Environmental Protection Agency (EPA), the California Air Resources Board (CARB), the Federal Trade Commission, the Attorneys General of each of the 50 states, and, in particular, the U.S. Department of Justice) have entered a decisive phase sooner than anticipated and require Volkswagen to maintain the highest degree of confidentiality. The extensive and confidential nature of these negotiations and Volkswagen's cooperation with the Department of Justice restrict Volkswagen´s ability to comment further on necessarily tentative results of the continuing investigation.

The further disclosure or characterization of interim results, which are currently available, would likely prejudice the rest of the investigation at this time, in particular because individuals who have yet to be questioned could align their statements with the contents of the interim report.

In counsel's view, a disclosure would also significantly impair Volkswagen's cooperation with the Department of Justice and weaken Volkswagen's position in any remaining proceedings.

In counsel's view, such disclosure could also jeopardize the credit that Volkswagen may expect to receive in the event of its full cooperation with the Department of Justice. According to Volkswagen's legal advisers, this could have very substantial negative financial consequences.
lf a full settlement can be achieved with the Department of Justice, the Supervisory Board and the Management Board currently expect that a detailed statement of the facts of this matter will be made public in the U.S. at that time. This is because the settlement of a criminal investigation with the Department of Justice is customarily accompanied by a detailed statement of facts, agreed to by the parties.

Volkswagen explicitly regrets that it is not able to publish interim results by the end of April as initially planned. However, due to the reasons outlined above, the Management Board and the Supervisory Board see themselves forced to refrain from a disclosure in the interest of the company.


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