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Phones for VW Lawyer, Emissions Tester Were Lost or Wiped Clean

Sept. 1, 2017
The issue arose in a case filed in state court in Virginia by VW owners who opted out of a nationwide class-action settlement announced last year.

Volkswagen AG’s top U.S. lawyer and the leader of its emissions-testing lab in California are among the employees whose mobile devices were either lost or erased as the company’s diesel cheating scandal emerged, according to court records made public on Thursday.

David Geanacopoulos, VW Group of America’s senior vice president for public affairs and public policy, reported he lost his phone while en route to Los Angeles International Airport on Dec. 1, 2015, according to the records. He was VW of America’s general counsel at the time.

The documents also show that the company cell phones of Anna Schneider, VW’s senior vice president of industry and government relations, and Matthias Barke, senior director of VW’s emissions test center in Oxnard, California, were "wiped" or erased of data in the months after the U.S. Environmental Protection Agency announced VW had rigged its vehicles to pass pollution tests.

Questions about the lost or erased phones were raised in December when the U.S. Federal Trade Commission asked the judge overseeing related litigation in federal court in San Francisco to order further questioning of Volkswagen U.S. officials about whether evidence, including mobile phones, was destroyed.

“In the context of the massive scandal at the center of this case, 23 lost or bricked phones is a bright red flag, especially when they include phones that belonged to important individuals,’’ the FTC said in the December filing.

Request to Seal Records Denied

The issue arose anew in a case filed in state court in Virginia by VW owners who opted out of a nationwide class-action settlement announced last year. The records were made public Thursday after the judge rejected the company’s request they be sealed.

The company and its attorneys have strongly denied any wrongdoing associated with the lost or erased phones.

“As we have stated previously, Volkswagen Group of America is not aware of any evidence that these mobile devices were intentionally wiped or lost," VW spokeswoman Jeannine Ginivan said in an email. "Nor has the Plaintiff produced any evidence that relevant data, including emails, were lost."

She declined to comment on the individuals named in the documents. Emails sent late Thursday to them, and a phone message for Schneider, were not immediately returned.

The 23 VW mobile devices were either wiped of data or misplaced between September 2015 and February 2016, according to the court records. The EPA accused Volkswagen of cheating on diesel emissions tests on Sept. 18, 2015. VW attorneys said in the court filings that "no evidence exists that any of the phones were intentionally lost, reset or wiped."

The litigation is a lingering aftershock of the scandal that has rocked Germany’s largest automaker. VW has admitted to installing software on about 11 million diesel vehicles worldwide between 2008 and 2015 that could limit pollution during lab tests but permitted the vehicles to exceed limits -- and perform better -- on the road. The company still faces investor lawsuits in the U.S. and Germany, as well as consumer lawsuits and a criminal probe in Germany.

Evidence of the lost and erased phones "will be significant for a jury’s determination of the amount of punitive damages to be awarded to a particular plaintiff," said Steven Webster, with Webster Book LLP in Alexandria, Virginia, the lead attorney for the Virginia plaintiffs.

VW attorneys sought to exclude references to the erased and lost phones from the litigation and seal the identities the VW employees, but were blocked by Bruce White, chief judge of the Fairfax County Circuit Court.

Vigorous Denial of Wrongdoing

"No evidence exists that any of the phones were intentionally lost, reset or wiped," attorneys representing VW wrote in a motion seeking to exclude references to the phones from litigation, adding that two of the Volkswagen of America employees "vigorously denied" speculation of wrongdoing during depositions.

In a June deposition filed in the case, Geanacopoulos said he lost his phone inadvertently. "I made every effort to find it," he said.

"If you thought that I were someone who wanted to eliminate data, I could think of a more effective way than to just leave a telephone that could be found and then to make efforts to find it," he said, according to the document.

Barke said he accidentally locked himself out of his phone after entering the password incorrectly too many times. The data had been eliminated when he rebooted it. Schneider’s phone was also wiped after too many attempts to input a passcode -- a not uncommon event at the company, according to another deposition by a VW representative.

The FTC’s request to further question VW on the issue was denied as moot in July because the agency settled its claims against the company.

“VW knew that iMessages that were on the lost or bricked phones were not preserved,’’ the FTC alleged in its case.

While Volkswagen Group of America contended its “designated corporate witness” had already answered thousands of questions during a deposition, the FTC said the person provided “nonsensical or evasive responses” when questioned about whether the company intentionally destroyed evidence, according to a filing in the case.

By Ryan Beene and Margaret Cronin Fisk

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Licensed content from Bloomberg, copyright 2016.

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