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

[n2doc]

Source: Fortune

Here’s an action that speaks volumes.

Beleaguered German car giant Volkswagen AG VLKPY 6.49% has hired the lawyers used by BP Plc BP -0.03% 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.


Read more: http://fortune.com/2015/09/23/volkswagen-hires-bps-deepwater-defense-team-as-the-lawsuits-start/

[NV Whino]

1. Wow. Just wow.

[Jeroen]

2. CEO Winterkorn is exit

Let's see how much money he takes with him

[dixiegrrrrl]

22. 32 million

http://www.democraticunderground.com/10027198398

[Jeroen]

23. Shameless, did not expect that much. n/t

[dixiegrrrrl]

24. Actually, I am now reading updates that it is 64 million.

Hopefully a lot is in stock.
Which is tanking fast.

[Jeroen]

26. "in addition to the continued use of a company car."

Yep, read in on huffington post.
Volkswagen employees will pay the price, as well as the environment.

[HooptieWagon]

3. The max US fine is $18B, however...

There is certainly going to be a class-action lawsuit from owners to recover the loss in value of their vehicles. I have no idea what settling that suit will cost. VW is in deep shit.

[jberryhill]

4. And the shareholders....

What is on the table are:

$18B fines for the Clean Air Act violations. That number is knowable since it is a statutory penalty for each violation.

However, the mix here includes:

The FTC for false advertising.

The DoJ for criminal conspiracy.

The owners, for being sold a performance "clean diesel" vehicle that wasn't.

The shareholders, for losing their shirts because management was engaged in crime.

And then a variety of state law actions.

They might as well start unbolting the assembly plants and having a yard sale. VW is toast.

[geek tragedy]

5. Kirkland and Ellis is a huge, and very high quality, firm.

There aren't very many firms that a corporation in as much (well-deserved) trouble as VW could hire to help manage this type of situation--Kirkland is one of them.

[groundloop]

6. How the hell do you 'defend' intentionally committing a crime .....

and then getting caught red handed? I can't wait to hear what kind of BS they dream up, but IMO the fact that VWs CEO has resigned is going to make their defense that much more difficult.

[geek tragedy]

7. typically they try to shield the upper management and throw

a few engineers, mid-level execs and possibly attorneys overboard.

That's what GM did.

[Locrian]

13. yep

In corporate world it's "let's play the blame game". A few engineers and accountants will probably get thrown under the bus while management proclaims their outrage that "corners were cut".

[R. P. McMurphy]

8. Were they hired because they're so good . . .

or because they're unethical and willing to try to excuse the indefensible?

[eggplant]

9. Lawyers defend clients. They don't judge them.

They were hired because this is exactly the sort of client they cater to. And once they are hired, they provide the best legal counsel they can -- that's their job.

To call the firm unethical is just wrong. Do you have any evidence that the firm acted unethically, or are you just going with guilt by association? (Even murderers are entitled to legal representation.)

[R. P. McMurphy]

11. Guilt by association.

You are correct. I have no proof that they acted unethically.

VW intentionally inserted the code to defeat the emissions test and they also lied to California about fixing the problem when the vehicles were recalled. Perhaps trying to help VW skirt responsibility is a moral lapse rather than ethical.

Thanks for pointing out my error. I need to remember to be more specific in my choice of words when condemning greedy businesses that believe it is okay to be socially irresponsible or to enable those who do so.

[eggplant]

16. You are suggesting that the lawyers they hired are enabling VW to be socially irresponsible?

How?

And just to be clear, I have no misconceptions about what VW did, or their intent while doing it. It simply would not be possible for them to pull this off without significant support of (or direction by) senior management. There are just too many people who would have to be involved for it to be otherwise.

[R. P. McMurphy]

17. Again, guilt by association.

BP's strategy was to try to deflect responsibility to other corporations involved with Deep Horizon (I believe that was the name of the drilling platform but I'm not 100% sure). A socially responsible company would have accepted culpability and taken it's lumps.

It is my opinion that this legal firm (I can't remember their name and don'want to look it up at this hour) advised BP to usr this strategy and probably actively helped them to do so.

I'm not omniscient but I'll bet that VW tries to limit their financial obligation in some way. How, specifically? I don't know but if they do then they are not being socially responsible. If this firm assists VW in liability avoidance then they are attempting to enable morally bankrupt behavior.

Pacific Gas & Electric's lawyers probably provided zealous and ethical counsel to shield them from liability from posioning those people. It still doesn't change the fact that, although it may be legal and possibly lucrative, assisting criminal behavior is wrong.

If you don't understand this then I believe you are being intentionally obtuse and merely want to argue.

[eggplant]

18. There's a difference between not understanding you and not agreeing with you.

And I have no interest in arguing with you. We've each said what we wanted to say, and I believe we each heard the other, and neither of us was convinced to change our minds.

So I'm content to leave it at that.

[R. P. McMurphy]

19. I like the way you respond.

You have been courteous and respectful even when I wasn't. For that, you have earned my admiration. I wish more people (including myself) would follow your example.

[eggplant]

20. I AM NOT SHOUTING!

[R. P. McMurphy]

21. You nailed me.

[OnyxCollie]

10. Waiting for Kenneth Feinberg to show up. nt

[d_legendary1]

12. Well that explains the $7 Billion they set aside

Grandstanding while only paying millions for their misdeeds.

[dembotoz]

14. Deep water cause they are in deep shit

Where I live a car needs to pass emissions test every so often
Assume same 4 diesel

Giant paperweight anyone?

[WhiteHat]

15. Why not?

The game is now only damage control. BP didn't pay nearly enough. That's a recommendation for their defense firm.