There have been some changes to the citizenship law in
Germany that now allow people to apply to become dual citizens through naturalization. The process is a bit complicated and the decisions are on a case by case basis. My German applied through the German Embassy in Ottawa for permission to obtain dual German-Canadian citizenship in March/April 2007 and was approved about 4-5 months later. The application fee was about EUR 265 at the time. He became a Canadian citizen two days ago after also jumping through Canada's hurdles. Now all he needs to do to complete the process is to send the German Embassy a copy of his Canadian passport and certificate of citizenship. I should mention that he would have to give up one of the citizenship if he wanted to join the military or run for public office.
We will be moving to Germany in the summer, so I also intend to apply for dual once I qualify. Eventually we will return to Canada, so this was one of the reasons we indicated it was necessary for him to have both.