US sues Volkswagen for $90 billion in damages

Washington/Frankfurt: The US justice department has sued Volkswagen for up to $90 billion for allegedly violating environmental laws — five times regulators’ initial estimate and a reminder of the carmaker’s problems nearly four months after its emissions scandal broke.

Although such US lawsuits are typically settled at a fraction of the theoretical maximum penalty, analysts said the size of the claim meant Volkswagen (VW) could face a larger bill than previously anticipated. “The announcement serves as a reality check of VW’s still unresolved emissions issues,” Goldman Sachs analysts wrote in a note, maintaining their “sell” recommendation on the stock. VW shares fell as much as six per cent to a six-week low in early Tuesday trade, the biggest drop on Germany’s blue-chip DAX index.