Volkswagen loses over gag order: 'Der Spiegel' magazine at liberty to repeat allegations against Lopez, judge rules

A HAMBURG court yesterday ruled that Der Spiegel magazine could repeat damaging allegations about Volkswagen's controversial production chief, Jose Ignacio Lopez de Arriortua, fuelling speculation over his future at the loss-making car firm.

The magazine is now free to repeat accusations that Mr Lopez and some of his closest colleagues took secret documents when they switched from General Motors to VW.

'On all the key points relating to breach of trust and industrial espionage, Volkswagen has lost,' GM's European subsidiary, Opel, said.

The ruling hit VW shares, which dropped nearly DM7 to DM351 at the close and continued lower in after-hours trading. 'There is a danger that Lopez is becoming too hot to hold, and that this will drive investors away,' one Frankfurt trader said.

VW's hopes for a return to profit are pinned on the tough cost-cutting techniques of the Spaniard, who is now the company's effective number two.

In lifting the gagging order obtained by VW, the court did not pass judgment on whether the allegations were true or not.

Instead, weighing GM's statements against those of Mr Lopez and Volkswagen, it decided which ones could be repeated.

The court also ruled, on the basis of affidavits from GM, that Der Spiegel could repeat allegations that Mr Lopez's departure for VW had already been decided a long time before he suddenly left Detroit on 15 March.

In a sworn statement, Mr Lopez had said he only decided to leave GM on 9 March upon learning that his 'dream' car plant would not be built in Spain.

In another sworn statement, Ferdinand Piech, the chairman of Volkswagen, said that he and Mr Lopez had first reached agreement about the latter's switch to VW on the evening of 9 March.

The judge, however, ruled that Der Spiegel could continue to say that Mr Lopez and Mr Piech were already in agreement about the move at the beginning of 1993.

Weighing up Der Spiegel's allegations on a point-by-point basis against Mr Lopez's counter-declarations, the court ruled that the magazine could continue to write that Mr Lopez and his close colleagues systematically collected secret GM material over a period of months before their departure; that before leaving, Mr Lopez obtained information about the future Opel Astra model; and that he also obtained photographs of the future Vectra model.

The Darmstadt state prosecutor, who is at present leading a criminal investigation into GM allegations of document theft by Mr Lopez and others, will also be using the evidence provided at the Hamburg civil court hearing.

In Detroit, General Motors unexpectedly settled a huge class-action lawsuit involving pickup trucks that featured the controversial 'side-saddle' petrol tanks. GM reached an agreement with lawyers on a plan to give owners a dollars 1,000 credit towards the purchase of a new GM truck. Critics claim the vehicle's design makes it more prone to catch fire in a side-on accident. GM lost a highly publicised liability lawsuit last year in Atlanta, and has been ordered to pay dollars 105m in damages to the victim's family.