VW Scandal: Top law firms competing for lead assignment in expected multibillion-dollar case
Top law firms competing for lead assignment in expected multibillion-dollar case
Lawyers from across the country will descend Thursday on a courthouse in New Orleans to jockey for a potentially lucrative assignment: a role in the massive consumer-fraud litigation facing Volkswagen AG over its emissions scandal.
Since the Environmental Protection Agency disclosed in September that Volkswagen cheated on emissions tests for seemingly environmentally friendly diesel vehicles, groups of consumers have filed more than 480 federal lawsuits against the company—in nearly 70 jurisdictions—seeking compensation for the alleged deception.
Involving approximately half a million U.S. cars sold since 2008, the litigation could prove one of the largest of its kind in recent years.
At a hearing on Thursday, lawyers will be allotted two or three minutes each to persuade a seven-judge panel of where they prefer the cases to be bundled up and heard. Consolidating the sprawling cases is part of a process called multidistrict litigation, generally seen as the best way to correct a “mass wrong,” said Alexandra Lahav, a professor at University of Connecticut School of Law. “It doesn’t make sense to resolve them one by one.”
The venue matters because lawyers with a home-court advantage are more likely to be appointed lead roles in steering the overall litigation. Judges also vary in their experience managing such complex cases and in how rigorously they scrutinize settlements.
The Volkswagen fallout has attracted hundreds of plaintiffs’ lawyers. Those expected to make appearances include plaintiffs’ firms with deep experience in consumer class actions, including California’s Lieff Cabraser Heimann & Bernstein LLP and New York’s Seeger Weiss LLP.
Also competing are firms that more often represent big companies, including Boies Schiller & Flexner LLP and Quinn Emanuel Urquhart & Sullivan LLP. Those two have each joined with a more traditional plaintiffs’ firm—Boies with Robbins Geller Rudman & Dowd LLP and Quinn with Hagens Berman Sobol Shapiro LLP.
“I anticipate a virtual cattle call of people going up and giving their pitches,” said attorneyW. Lewis Garrison, who wants a role and is pushing for Birmingham, Ala., as a lower-cost venue.
Court filings urging the panel to pick the best location read at times like travel brochures, with plugs for airport amenities and world-class universities.
A pitch for Chattanooga, Tenn., where some Volkswagen cars are manufactured, bragged about its “city-wide access to the fastest broadband Internet speeds in the nation.” Those pushing for New Jersey tout its easy access to Europe, where many Volkswagen witnesses are likely located. A California contingent points to the state’s high number of impacted vehicles and strong environmental regulatory agency.
A Volkswagen spokeswoman declined to comment. But in a court filing, the company said it supports moving the lawsuits into one court and would prefer either Virginia, where Volkswagen and Audi have U.S. headquarters, or Detroit, near a Volkswagen facility and EPA laboratory. The Justice Department also has weighed in, saying it supports Detroit. The civil litigation is happening in parallel to regulatory and criminal investigations.
The panel, which meets several times a year in various cities around the country, is expected to release its venue decision in days or weeks. Then, the judge assigned the case will appoint a committee of lawyers to take the lead. That group must fund the litigation, which can cost tens of millions of dollars. But they also stand to benefit as potential damages could reach billions of dollars and the attorneys are in line for a share.
For Quinn Emanuel, which appeared opposite its now-partner Hagens Berman when defending Hyundai Motor America in a case over fuel-economy misrepresentations, the litigation presented a unique opportunity to be on the plaintiffs’ side in an auto case, according to Los Angeles partner Shon Morgan.
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“Our defense-side clients are not happy with Volkswagen either,” Mr. Morgan said. His firm is hoping to have the case assigned to a Los Angles court.
Boies Schiller has taken on consumer cases before; earlier this year, David Boies was selected to help work for the plaintiffs on key aspects of litigation over malfunctioning Takata Corp. air bags. Mr. Boies plans to attend Thursday’s hearing, according to court filings, as a proponent of moving the litigation to Washington, D.C.
Lawyers say Volkswagen’s acknowledgment that it did something wrong sets it apart from other car-related cases and will cut back on the initial discovery phase.
The biggest challenge, say plaintiffs’ lawyers, will be working with the auto maker on a way to compensate those who bought or leased the affected vehicles. Volkswagen has said as many as 11 million cars world-wide contain defeat devices, software that can make cars appear less polluting during emissions tests. Consumers paid as much as a $6,000 premium for these diesel models compared with gasoline-powered versions.
Proposed solutions range from covering the cost of any loss in value to buying back the vehicles.
Meanwhile, Volkswagen is offering a $1,000 “goodwill package” to consumers, which doesn’t preclude them from taking part in the litigation.
The drivers “thought they were being environmentally responsible, thrifty and green,” said Elizabeth Cabraser, a San Francisco lawyer who is working on several multidistrict litigation cases, including one against General Motors Co. over its ignition-switch defect. “Their expectations were betrayed.”
source: WSJ – Lawyers Suing VW Vie for Role, Venue
