Porsche won a key legal victory after a New York appeals court panel dismissed a lawsuit by 26 hedge funds seeking more than $1.4bn in damages stemming from the sports-car maker's failed attempt to take over Volkswagen four years ago.

The 26 funds, which included Viking Global Equities and Glenhill Capital, claimed they were misled and defrauded by Porsche in 2008 over its intent to amass a large stake in Volkswagen. But in its ruling, a five-justice panel of the New York State appeals court in Manhattan unanimously found that New York state wasn't the appropriate place to bring the hedge funds' claims, given that the events surrounding the takeover attempt occurred largely in Germany.