Volkswagen said in a statement on Sunday that it had been aware of the allegations for some time.
Dieselgate: Court orders top Volkswagen shareholder to pay damages to investors over handling of emissions scandal
The 2015 revelation sent the value of the Volkswagen's stock plunging more than 40 percent and Porsche SE's 30 percent in the following days.
CO2 emissions have become a big issue in Europe since Volkswagen's scandal in September 2015.
"There won't be any Porsche diesels in the future," said company CEO Oliver Blume in a statement.
The question of who knew what, and when, will be vital in determining the outcome of the suit.
Volkswagen has scaled back brand presentations at traditional car shows, including Detroit and Frankfurt since the VW emissions scandal erupted in 2015.
Audi said it had stopped deliveries of A6 and A7 models with a certain type of diesel engine after finding a previously unidentified problem with emissions software.
Volkswagen managers and unions are seeking to curb competition from lower-cost stablemate Skoda.
Volkswagen decided on the strategic shift to electric vehicles (EVs) after it was engulfed in the “dieselgate” scandal.
Greenpeace said its volunteers had used kayaks and boats to board the ship in the Thames Estuary.
By the end of next decade, Volkswagen vows to offer "at least one electrified version of each of the 300 or so group models", the firm said in a statement.
Germany already knew over a year ago that Porsche had installed illicit software to falsify the emission levels of its diesel vehicles in test settings,
Volkswagen's planned sale of motorcycle brand Ducati and transmissions maker Renk has currently no majority backing on the carmaker's supervisory board.
Audi, Volkswagen's main profit driver, plans to bring five new all-electric models to market in coming years, starting with the e-tron sport-utility vehicle.
The EU rules are a response to the 2015 dieselgate scandal when Volkswagen was found to have used software to cheat US diesel emission tests.
German Chancellor Angela Merkel faces on Wednesday a grilling by lawmakers investigating if her government shielded Volkswagen from regulators despite knowing the auto giant was carrying out emissions cheating.
If the U.S. regulators reject Volkswagen's fix, the carmaker could end up paying around $4.04 billion
Bentley says that it wants to focus on smaller events while Lamborghini is revising strategy pertaining to which auto shows to attend