ACTIONS CORNER

In the case about the discharge to top managers in the course of the takeover of Dresdner Bank, Commerzbank has scored a victory before the Frankfurt Higher Regional Court (OLG). The court found no breaches of law in the takeover of Dresdner Bank by Germany’s second-biggest finance house. The purchaser’s failure to take a vote of shareholders was legal. All the actions for avoidance and nullity again resolutions of the May 2009 AGM were thrown out by the OLG. Many shareholders felt they had been passed over in the purchase decision and wanted not to give discharge to the board or Supervisory Board.

Against payment of a sum of some 554 million dollars by Deutsche Bank, the New York state prosecutors and American revenue authority IRS have stopped their multiyear investigations of the bank for connivance in tax evasion. The investigations concerned the bank’s involvement in “tax-related transactions for customers”. Because of the sale of fraudulent tax-saving models sold to rich Americans between 1996 and 2002, using which profits could apparently be slipped past the Revenue, the bank has to pay this amount, suspected of being a record, following a settlement with the American tax authorities.

In the mammoth trial against Deutsche Telekom, an end seems to be in sight. Thus, before Frankfurt Higher Regional Court (OLG) on 15 December, Birgitta Schier-Ammann stated that there was an error in the prospectus for the formally state-owned firm’s third IPO. However, the judge left open the question of how important this would ultimately be and whether compensation claims would follow for the 17,000 disappointed Telekom shareholders, for share-price losses amounting to some €80 million. After 16 days of proceedings, the OLG set 13 April as the date for announcing its decision.

On 15 December the three parties to the dispute, Deutsche Telekom, Elektrim and Vivendi, signed an agreement settling their legal disputes, which have lasted over 11 years, about Polska Telefonia Cyfrowa (PTC). Under the agreement, the Bonn company are paying a total of €1.4 billion to Vivendi. As a counterpart they will receive the remaining 51% of Poland’s third-biggest mobile-telephony operator. The French telecommunications and media group had wrongly purchased 51% of the shares in PTC in 1999, a fact that however did not emerge until 2004. By selling to the French, the Polish company had infringed the Germans’ preemption rights.

E.ON is going to have to pay heavily for breaking a seal on a store-room door following a search in its business premises in May 2006, with which EU competition authorities wanted to safeguard documents against subsequent corrections. Germany’s biggest energy group had rejected the charges. The European Court of Justice in Luxembourg has now, on 15 December, rejected an action for nullity by E.ON against the penalty handed down in 2008. The judges regard the fine for negligent or deliberate breaking of the seal, amounting to 0.14% of turnover, as by no means inappropriate. The group would have to pay the fine set, of €38 million.

Two years after carrying out raids, the EU Commission on 10 December opened formal investigations against a presumed Europe-wide cement cartel of eight companies – including HeidelbergCement. The company is suspected of having deliberately restricted trade in cement, pre-cast concrete, clinker and slag, in a cartel, thereby artificially driving up prices. The initial suspicions are also based on price agreements and market-sharing agreements, stated the Commission in Brussels. The accusations have not being confirmed.

Michael Jaffé has sued Infineon Technologies for alleged formal errors in its hiving off of Qimonda in 2006. The bankruptcy administrator has filed suit accordingly with Munich Regional Court. According to the semiconductor group’s statement, he is accusing the DAX company of omissions in outsourcing memory-chip activities, causing the former memory-chip subsidiary financial disadvantages, in Jaffé’s view. Infineon admitted that the amount involved could theoretically be several hundred million Euros. However, reserves have not been set aside for this.

Merck is paying 280 million dollars to settle a legal dispute with Dey. In 2007 US justice authorities had brought proceedings against its former US subsidiary for restitution of increased prices for medicaments. This was stated by Mylan, which had taken over the Darmstadt pharmaceuticals and chemicals group’s business in generics. The Darmstadt company had sold its former subsidiary the same year to the US generics firm; it was however agreed that the German pharma group would be responsible for the consequences of the impending lawsuit. Dey was, according to Merck, accused of having made false reports about certain price information.

SAP is to pay Oracle in the US over 210 million dollars in interest on the 1.3 billion dollar damage payment. The increased claim emerges from documents filed in court in early December, reports Reuters. However, the verdict is not yet unappealable, and the Walldorf people are considering appealing: “We do not believe Oracle is entitled to any compensation at all beyond the final court verdict in the case,” said central office in Walldorf. This sort of claim was “routine”, stated lawyers for its US rival.

Together with other European railways, Deutsche Bahn is suing several members of a carbon and graphite products cartel for compensation because of price agreements, amounting to €101 million. According to Deutsche Bahn, among other carbon producers SGL CARBON is being sued. Deutsche Bahn had filed a corresponding suit in the London antitrust court against the supplier. The products concerned were from smaller marginal businesses that had been sold by 2003, responded the Wiesbaden graphite specialists.

Only one day after Munich public prosecutors’ major search operation on 15 November 2010, Siemens has filed suit against the former director-general for Telecommunications and Informatics of Siemens Greece. The long-term Siemens manager is accused of not having furnished any documentation on the use of some 8 million euros from the group’s presumed slush funds in Switzerland. An ex minister was also being charged by Greek authorities with money laundering, after admitting accepting bribes in the 1990s.

Only a few months after starting up the first blast furnace, ThyssenKrupp is facing new problems with its new steelworks in Brazil. The top criminal-prosecution authority in the Federal State of Rio de Janeiro and a group of Greens are accusing managers of a group subsidiary of, among other things, health-threatening emissions from the works; the group denies this. The steel and industrial-goods company had, it stated, not yet been officially informed of any criminal proceedings. Nor would that be case until a case prepared by public prosecutors in Rio de Janeiro was accepted by the court.