Porsche 2009 Annual Report Download - page 92

appropriate provisions are created to cover any ensu-
ing losses. For this reason, the company is of the
opinion that these risks will not have any sustained
negative impact on the economic position of the
group. However, due to the fact that some risks can-
not be estimated, or only to a limited degree, it can-
not be ruled out that losses will eventuate that are not
covered by the provisions already created.
There are investigations by the public prose-
cutor against the former members of the executive
board Dr. Wendelin Wiedeking and Holger P. Härter in
connection with allegations of share price manipula-
tion. Porsche SE examined these allegations in detail
and commissioned expert reports from two university
professors with special expertise in the field of capital
market law. The examination and the expert reports
come to the conclusion that there was no infringe-
ment of the law. The investigations in connection with
allegations of delayed publication of an ad hoc an-
nouncement and distribution of insider information in
one case have already been closed due to insufficient
evidence for a charge.
On 25 January 2010, 17 plaintiffs filed a
complaint for damages in the USA against Porsche
SE and former members of its executive board Dr.
Wendelin Wiedeking and Holger P. Härter with the
United States District Court for the Southern District
of New York. On 29 April 2010 and 4 June 2010, the
complaint was expanded to a total of 41 plaintiffs,
and the alleged damages were estimated at more
than two billion US dollars. The plaintiffs filed a third
amended complaint on 21 July 2010 on account of a
ruling issued shortly before by the U.S. Supreme
Court. Whereas all 41 plaintiffs had filed claims in the
second amended complaint with reference to the U.S.
Securities Exchange Act of 1934, the number of
plaintiffs referring to this legal basis for their claims
was down to 16 in the third amended complaint. Six
plaintiffs withdrew their claims against all defendants
on the same day, 21 July 2010. On 20 May 2010, a
claim for damages was submitted to the same court
in New York, with damages claimed totaling “several
hundred million dollars”. This claim was amended on
23 July 2010. Both complaints allege that Porsche
SE’s activities in connection with its acquisition of a
stake in Volkswagen AG during the year 2008 consti-
tuted market manipulation and securities fraud in vio-
lation of the U.S. Securities Exchange Act. Porsche
believes that both complaints are inadmissible and
without merit, and has sought their dismissal. In Ger-
many, institutional investors have applied for concilia-
tory proceedings against Porsche SE with regard to
the assertion of claims for damages on the basis of
alleged breaches of statutory capital market regula-
tions. These claims relate to the alleged loss of earn-
ings, estimated by the investors to be around 2.5 bil-
lion euro. Porsche SE will not take part in the pro-
ceedings, and considers the asserted claims to be
without merit.
The company deems that adequate provision
has been made for the anticipated lawyers’ fees and
litigation expenses.
Tax risk
The company considers that some of the
stock option transactions it has entered into result in
tax-free profits and tax-deductible losses. A dispute
has developed between the company and the tax au-
thorities with regard to the tax treatment of the stock
option transactions. The tax authorities did not accept
the opinion held by the company. Porsche SE has
filed an appeal against the tax authorities’ decisions.
Upon request, the tax authorities have granted a stay
of execution on the subsequent tax payments until the
final ruling on the tax treatment has been handed
down. The risk relating to the Porsche SE group’s re-
sults of operations is fully covered by existing provi-
sions. The maximum liquidity risk corresponds to the
amount provided for.
92 Group management report