VW is planning to sue a small London creative agency after an "ad" in which a suicide bomber detonated himself inside a Polo made its way onto the internet. Is VW's reaction justified or is the multinational merely over-reacting?

VW is planning to sue a small London creative agency after an "ad" in which a suicide bomber detonated himself inside a Polo made its way onto the internet. Is VW's reaction justified or is the multinational merely over-reacting?

The spoof advert shows a man with Arab headdress hopping into a car and driving round London before stopping outside a restaurant where he then blows himself up. The car remains intact and the slogan used in its UK campaign, "Polo: small but tough" appears.

The agency has apologised, saying it was created for showreel (portfolio) purposes and was never meant for viewing by millions around the world via the internet. The advert's director apparently said he was shocked that the ad had made it onto the internet and caused such a fuss.

VW has completely denied any association with the advert and has vowed to sue the agency on the grounds that it may damage the manufacturer's reputation by linking it with terrorism.

"We are taking legal action but, because it's in the early stages, we cannot comment further," a Volkswagen spokesman said.