ACTIONS CORNER

A court in Arkansas has ordered Bayer, after years of controversy over GM maize, to pay 136.8 million U.S. dollars. The U.S. jury ruled that Bayer CropScience must pay Riceland Foods 11.8 million U.S. dollars in compensation. The pharmaceutical and chemical company regards especially the punitive damage payment contained in the penalty, which can be imposed for particularly reckless behaviour, in the amount of 125 million U.S. dollars as “completely unjustified”. The producer of plant protection products and seed is still examining its legal options.

Six former and current employees accuse a Bayer subsidiary in the USA, in an application filed on 21 March in federal court in New Jersey, of systematically disadvantaging them in pay and promotion and also of putting mothers and pregnant women under pressure. In addition, women were characterized as “sneaky” and “indecisive”, reports the Süddeutsche Zeitung. The female employees of Bayer Healthcare Pharmaceuticals are calling for 100 million U.S. dollars. The pharmaceutical company has rejected the accusations and announced it will defend itself against them.

The Commerzbank has failed before the London Court of Appeal in its application to have summary proceedings by more than 100 former bankers at Dresdner Kleinwort dismissed. There will now be a lawsuit in which the investment bankers will sue the former Dresdner Kleinwort for bonuses of €50 million. The court in London ruled on 8 March that the bankers may use written commitments from before 19 December 2008, when they received a letter on bonuses to the employees of the investment bank. Because of the 2008 financial crisis the bank had suffered losses of 6.5 billion euros.

On 9 March Deutsche Bank premises in South Korea were apparently searched by public prosecutors. The Bank is cooperating with the prosecutors in the investigation into the causes of the stock-market crash of 11 November 2010, which wiped out 26 billion dollars in stock-market value. The Seoul stock market had local brokerage subsidiary DSK excluded from proprietary trading in equities and derivatives in February for six months, over unfair trade practices. Germany's largest bank now expects losses of approximately ten million dollars because of its half-year exclusion. Five people are still under investigation.

Before the Federal Court, the Deutsche Bank has suffered a bitter defeat in its dispute over so-called “interest-rate bets”. Germany's biggest bank is to take responsibility for the losses and pay damages in the amount of the €540,000 that Ille GmbH lost on risky interest-rate swap transactions mediated by the bank. In the Court’s view the Bank had breached its duty to provide advice and information to its Hessian corporate clients. It is the first time the highest court has ruled in the dispute on interest-rate swap risks between German municipalities plus medium-sized companies and the banks.

Rolf-Ernst Breuer has had to answer charges of attempted malicious use of process in the Deutsche Bank v. Leo Kirch case before the Munich Higher Regional Court. The criminal division took the prosecution charge to trial. Thus, for the first time in almost ten years, on 25 March the insolvent media manager and the ex-head of Deutsche Bank, whom Kirch holds responsible for the collapse of his empire, met again. The former media mogul accuses the Frankfurt bank of having brought about the insolvency of his group through a TV interview in 2002.

The Finance Committee of the City of Dresden will sue GAGFAH. The City Council was unanimously in favour of claiming penalty payments of up to €1.06 billion plus interest from the real-estate group. The major rental agency is alleged to have failed to comply with the sales contract and the provisions for tenant protection for the 48,000 former council houses in 74 cases out of 167. Over the contract period of ten years two million euros are incurred for each violation, added SPD Group chairman Councillor Peter Lames. The complaint should be filed by the end of March.

William Brennan, meanwhile, has rejected the insider allegations raised against him. BaFin is investigating the chairman of the Gagfah management. The background is that the head of the largest German listed residential-property company sold Gagfah shares worth €4.7 million on 3 February. Brennan denies the allegations, but confirmed that he had long known of the city of Dresden’s investigations on the subject. The city of Dresden had not, however, indicated that they would make claims of any considerable magnitude. Gagfah had heard of these only on 4 March.

Erich Kellerhals, one of the founders of Media Markt/Saturn, is taking the majority shareholder Metro to court. Kellerhals fears that the retail group wants to overturn the minority’s co-decision rights. The electronics chain’s partners’ committee had decided in early March, by simple majority, to establish an advisory board, to largely take over the Committee’s powers. Cordes wanted to take sole power in the electrical retailer, says Kellerhals. De facto, the decision would deprive the minority shareholders of their veto right.

RWE is suing the federal government for ordering the temporary nuclear moratorium and wants to restart the Biblis A nuclear power plant in Hesse soon. The suit was submitted to the administrative court in Kassel on 1 April. It was actually a company-law requirement, quoted the German Press Agency. Each day’s stoppage of Biblis A costs the power company around one million euros in profit, in the opinion of experts. The group surprisingly withdrew on 1 April a statement a few hours old that it was currently not making preparations for restarting the reactor.

The European Court on 3 March rejected the action by Siemens against an antitrust penalty. The German industrial group had sued against the fine of €396.6 million because of a cartel for gas-insulated switchgear. Siemens and ten other European and Japanese companies like Mitsubishi, Toshiba and Alstom were given fines totalling €750 million by the EU Commission in January 2007 because of illegal price fixing in the sale of switching systems. ABB turned state evidence about the cartel and was thus spared the originally intended fine of €215 million.