German prosecutors raid Jones Day's Munich office in Volkswagen investigation


Jones Day’s Munich office has been raided by German prosecutors investigating the firm’s client Volkswagen.

The move, which came two days before German Chancellor Angela Merkel was due to arrive in the US for a meeting with President Donald Trump, was called “unacceptable” and a “clear violation of legal principles” in a statement by Volkswagen.

Jones Day has been handling an internal investigation for the German auto giant, into an emissions software scandal that led Volkswagen to reach a $15.3bn (£12.4bn) settlement in October to resolve consumer class actions. In January, Volkswagen agreed to pay $4.3bn (£3.5bn) in civil and criminal penalties in an agreement with the US Department of Justice.

In February, Volkswagen agreed to pay another $1.2bn (£971m) to settle a few remaining claims and a suit brought by the Federal Trade Commission involving 75,000 3.0-litre diesel engine vehicles.

German prosecutors have been conducting an investigation into whether certain Volkswagen executives were responsible for the emissions scandal at the company. A summary of Jones Day’s findings has been provided by Volkswagen to the Justice Department, but has yet to be released publicly. Reuters reported that Jones Day’s probe found instances of wrongdoing by certain Volkswagen executives but exonerated members of the company’s management board.

In January, Volkswagen’s top emissions compliance officer, Oliver Schmidt, and five other corporate executives were indicted as the company – advised by Sullivan & Cromwell, Steptoe & Johnson and Freshfields Bruckhaus Deringer – agreed to plead guilty to three US felonies related to its emissions scandal. Later that month, Volkswagen’s top compliance chief, former German judge Christine Hohmann-Dennhardt, unexpectedly left the company with a $12.8m (£10.4m) exit package, according to news reports.

German prosecutors searching Jones Day’s Munich office did so the same day that the headquarters of Volkswagen’s Audi unit were also searched, according to German newspaper Handelsblatt, which first had news of the raids. The paper noted that Jones Day’s internal investigation is not yet complete.

Two media representatives for Jones Day did not immediately respond to a request for comment on the matter. Volkswagen, in its statement, did not mince words.

“In our opinion, the search of a law firm mandated by a company contravenes the principles of the code of criminal procedure,” Volkswagen said.

German legal publication Juve reported that several German firms – such as Brehm & v. Moers, Eckstein & Kollegen, Haver & Mailaender and Krause & Kollegen – have been retained by Audi executives as a result of the investigation by German authorities.

The search of law firm offices by government authorities, while unusual, is not without precedent. The American Lawyer reported in 2009 on the Moscow offices of DLA Piper and White & Case being raided by officials from Russia’s interior ministry, as part of an investigation into the development of a hotel in the city.

For more on Jones Day, see: The secretive firm and its very famous client: Trump ties thrust Jones Day into the spotlight