Deutsche Bank has said it will not pay costly out-of-court compensation to the heirs of Germany's late media tycoon, Leo Kirch. The turnaround came after comprehensive legal counseling.
Deutsche Bank on Thursday rejected a proposed out-of-court settlement in a 10-year court case surrounding the bankruptcy of Germany's late media tycoon Leo Kirch.
The long-running legal disputes were initiated by Kirch and his associates, who claimed that comments made by Deutsche Bank's former chief executive Rolf Breuer were at least partly responsible for triggering the 2002 bankruptcy of the publishing group Kirch Media.
In a televised interview, Breuer had questioned Kirch's creditworthiness, later prompting the media giant, who died last July at the age of 84, to sue Deutsche Bank for more than three billion euros ($4.1 billion).
Deutsche Bank's board of mangers on Thursday unanimously rejected the proposed compensation. The bank declined to comment on the values of the suggested settlement, but German media had put it about 800 million euros.
The rejection came amid fears that a costly out-of-court settlement could expose Deutsche Bank to even costlier lawsuits from its shareholders.
It's seconds out again
No details where given as to if and when direct negotiations between the two sides would be resumed.
Over the past couple of years, talks about an out-of-court settlement had failed a number of times, but the parties agreed that a positive outcome had never been as close as this time around.
Deutsche Bank's outgoing chief executive, Josef Ackermann, had announced recently that he aspired to hand over his business to his successors Anshu Jain and Jürgen Fitschen without any major unresolved issues. Analysts had therefore expected that a settlement with the Kirch heirs was just around the corner.
However, Deutsche Bank only paved the way for yet another round in what's already the biggest legal battle in Germany's corporate history.
hg/ng (AFP, Reuters, AP)