Justice Department blocked from sharing Volkswagen documents: judge

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A federal magistrate judge obstructed the United States Justice Department from showing a German law firm 25 million pages of records revealed by Volkswagen in the government’s diesel emissions investigation.

The order, issued on Friday by U.S. Magistrate Judge Jacqueline Corley in California, is a victory for the automaker, which deals with 1,600 securities suits in Germany associated with its diesel emissions scandal. The company turned over the files as part of prosecutors’ probe of its setting up software to hide excess emissions.

The suits jointly seek almost 8.6 billion euros ($10.3 billion) from the automaker, according to a court filing.

The Justice Department took legal action against Volkswagen in Germany in September 2016 for the losses in federal government employees retirement accounts and retained German law firm GSK Stockmann to represent the U.S. government. It looks to recover 30.8 million euros ($ 37 million), in addition to interest and legal fees.

Legal representatives for Volkswagen challenged the Justice Department’s planned transfer of the files and said if it were successful, all 1,600 plaintiffs would have access to them.

The automaker noted some Volkswagen submissions in Germany ended up being public in the German press days after they were submitted. “It is most likely that at least a few of these files would also be leaked to the press,” VW lawyer Thomas Liebscher wrote in an affidavit.

Judge Corley stated that a protective order between the automaker and the government disallows the sharing of the files with the Justice Department’s German law firm. Corley stated GSK Stockmann can not use the the files obtained by the department “to end-run around German discovery rules.”

Volkswagen has accepted to spend about $25 billion in the United States to deal with claims from owners and regulators over polluting diesel vehicles and has offered to redeem about 500,000 vehicles.

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