Court Considers Retrial for Deutsche Bank Boss
October 21, 2005
Germany's top criminal court this week fueled speculation that they could reopen the case against Ackermann and former Mannesmann head Klaus Esser concerning the bonuses they received during a merger.
The Federal Court of Justice expressed doubts as to whether the 60 million euros ($72 million) in payouts they approved for Mannesmann executives when it was bought out by British telecom giant Vodafone in 2000 were in company's best interest.
The panel of five judges heard six hours of oral arguments Thursday and scheduled more for Friday, but it may take weeks deliberating on the case before issuing a verdict.
A lower court in Düsseldorf in July 2004 found the men not guilty in on charges of breach of trust. Prosecutors had accused them of rubber-stamping multi-million-euro golden handshakes to managers at the end of the fierce Mannesmann-Vodafone takeover battle four years ago that ended with the British giant paying 178 billion euros for Mannesmann.
Ackermann not expected to resign
A spokesman for Germany's shareholder association DSW called for Ackermann's resignation should the court order a retrial.
"That would be too clear a sign that the court believed that breach of trust is a possibility," Jürgen Kurz told the Tagesspiegel newspaper earlier this week.
However analysts said they don't anticipate any changes on the top floor, even if Ackermann has to face another trial.
"I don't expect Ackermann to resign," Fairesearch analyst Dieter Hein told Reuters. "There was no change in management in the first trial and I don't expect one now."
Prosecution confident case will be reopened
Though Ackermann has maintained that the charges against him were baseless, the prosecution is still demanding prison sentences of varying length with or without probation for him and the five other co-defendants. Alongside Ackermann and Esser, they include Mannesmann's former supervisory board chief Joachim Funk, the former head of the powerful IG Metall labor union, Klaus Zwickel, and two bothers, Jürgen Ladberg and Dietmar Droste.
The Mannesmann board had approved 111.5 million deutsche marks ($71 million) in bonuses to management board members during the multi-billion-euro takeover. Esser alone got more than 15 million euros.
Though the lower court ruled that while the payouts may have been against Mannesmann's interests and possibly have broken German tax law, they did not constitute criminal action, prosecutors Thursday were confident about their chances at getting the case reopened.
"The way the case has gone so far, it looks like our appeal has been dealt a good hand," federal prosecutor Gerhard Altvater told Reuters.
Esser's lawyer Sven Thomas, however, argued his client had stockholders' -- and thus the company's -- best interest in mind during negotiations of the world's largest corporate merger of the time.