The California State Teachers’ Retirement System, or CalSTRS, announced Friday it aims to join a German shareholder group lawsuit aimed at Volkswagen (VW).
CalSTRS owned $52 million in the German car producer’s stock as of Dec. 31. After divesting its thermal coal interests in February, CalSTRS has now decided to target one of the heaviest hitters in the automotive industry, VW.
CalSTRS has not disclosed how much money it has lost as a result of the German car producer’s emission cheating scandal.
“Volkswagen’s actions are particularly heinous, since the company marketed itself as a forward thinking steward of the environment,” CalSTRS Chief Executive Jack Ehnes said in a press statement Friday. VW’s emissions scandal has tainted VW’s brand, he added.
Ehnes went on to say the fund hopes to recoup lost assets as well as send the message that CalSTRS “will not tolerate these illegal actions.”
CalSTRS is the second largest retirement pension in the world with $186 billion in assets, behind only California’s Public Employees’ Retirement System, or CalPERS, which announced Friday it also plans on suing VW in a separate lawsuit.
The retirement fund has fallen hard times, however, as it has nearly $70 billion in unfunded liabilities, according to CalSTRS’ own website, meaning it is currently handing out more money to beneficiaries than it is pulling in from assets and employees.
Even as CalSTRS continues to row heavy oars, looking for life rafts to fix its sizable unfunded liability obligation, the fledgling retirement fund moved in early February to purge the $1.5 million it holds in thermal coal assets.
“We determined that given the financial state of the industry, the movement of the regulatory landscape and coal’s impact on the environment, its presence reflects a loss of value,” the fund’s Investment Committee Chair Sharon Hendricks said in a statement at the time of the decision.
Companies from across the coal industry will be affected by the fund’s decision to divest, including Cloud Peak Energy, Hallador Energy Company, Peabody Energy Corporation, and Westmoreland Coal Company.
VW, for its part, acknowledged in September installing so-called defeat devices in a bevy of its vehicles to fool emission standard testing. It is facing fines and lawsuits topping $50 billion, potentially ruining the decades old auto company.
Indeed, as of Feb.4, VW’s market share toppled from 8.5 to 7.1 percent. Still, even with the fledgling sales, the company managed to hold its own in the car market behind Ford and British vehicle maker, Vauxhall.
Several class action shareholder lawsuits have been filed against VW in the U.S.
In many of the lawsuits against VW outside the U.S., shareholders are not automatically lumped into the class action litigation; companies like CalSTRS have to opt-in in order to join the German lawsuit.
Follow Chris on Facebook and Twitter
All content created by the Daily Caller News Foundation, an independent and nonpartisan newswire service, is available without charge to any legitimate news publisher that can provide a large audience. All republished articles must include our logo, our reporter’s byline and their DCNF affiliation. For any questions about our guidelines or partnering with us, please contact licensing@dailycallernewsfoundation.org.
