Settlement collapses: church dispute back in court

Settlement collapses: church dispute back in court

This continues the bitter dispute that has been going on for ten years about the alleged responsibility of the bank and its former CEO rolf breuer for the collapse of the kirch group in 2002.

According to statements made on thursday, the bank’s board of management "after careful consideration" rejected an extrajudicial settlement to resolve the conflict. The payment of a good 800 million euros was in the offing. In return, the church side was to waive all claims for damages.

"On the basis of this review, also taking into account internal and external legal advice, the management board has decided by mutual agreement not to accept the settlement proposal," the bank said in frankfurt. According to financial sources, it had been clear for several days that there was resistance to the expensive deal at the bank.

The church reacted with incomprehension to the decision. A spokesman said that the bank took note of the rejection and "shook its head over the management chaos that had become apparent at the top of the bank". The bank had left the decision to lawyers who were acting in their own interests. Anyone who does something like this should not be surprised "if he ends up with short pants."

The conflict was triggered by breuer’s remarks in a television interview at the beginning of february 2002. When asked about kirch’s creditworthiness, the banker had told the news agency bloomberg: "all you can read and hear about it is that the financial sector is not prepared to provide further debt or even equity capital on an unchanged basis."

From kirch’s point of view, breuer and the bank, to whose customers kirch was paying, thus provided the ransom for the collapse of the convoluted and highly indebted media empire. Kirch unleashed an avalanche of litigation and fought until his death on 14 december. July 2011 bitter dispute over billions of euros in damages.

The dispute now moves back into the courtroom. Also on thursday, it became known that the deutsche bank failed in its attempt to stop an important civil suit for billions in damages. Judges at the munich higher regional court (OLG) dismissed a motion by the bank to recuse itself.

This means that the spectacular trial (file: 5U 2472/09), which the bank had stopped for the time being in mid november minutes before the testimony of publisher friede springer with motions of bias against presiding judge guido kotschy and his two associate judges, can continue. In the proceedings, the higher regional court examines the circumstances of the bankruptcy in 2002. The kirch side claims more than two billion euros in damages. Kotschy had made it clear several times during the trial that he did not really trust either side. A date for the continuation of these proceedings had not yet been set.

The bank and kirch had already tried several times to settle the dispute outside the courts. This time, an agreement seemed within reach, because deutsche bank CEO josef ackermann, who was leaving at the end of may, had declared at the beginning of february that he wanted to leave his successors a clean house. There are still some settlements pending where it makes economic sense.

In 2006, the german federal supreme court (BGH) ruled that kirch could in principle be entitled to damages. Karlsruhe ruled that breuer had breached contractual obligations to kirch’s company printbeteiligungs gmbh by publicly expressing doubts about kirch’s creditworthiness. A liability of the biggest german bank for the collapse of the entire media group (u.A. Prosieben, SAT.1) however, the judges denied this (ref.: XI ZR 384/03 of 24. January 2006).