Deutsche Bank Loses Kirch Media Trial
A German court ruled Deutsche Bank must pay damages, which could total almost $2 billion, to the heirs of late media mogul Leo Kirch.
COLOGNE, Germany - A decade after the collapse of German media conglomerate KirchMedia and a year after the death of its founder, Leo Kirch, a German court has ruled he was right, all along.
On Friday, the state appellate court in Munich found in favor of the late Bavarian mogul, ruling that Ralf Breuer, then CEO of Deutsche Bank, was responsible for the implosion of Kirch's media empire. The court said Breuer's comments to Bloomberg TV in 2002, in which he questioned Kirch's credit worthiness, were in part responsible for driving KirchMedia into bankruptcy. At the time, Deutsche Bank was KirchMedia's biggest creditor.
The collapse of the media giant, which was the world's largest licenser of film rights and whose assets included European broadcaster ProSiebenSat.1, German pay TV operation Premiere and rights to the Formula One racing circuit, was the largest bankruptcy in Germany since the end of WWII.
Judge Guido Kotschy ruled that Deutsche Bank must pay damages - which could range from $157 million to almost $2 billion - to Kirch's heirs.
In the suit, filed shortly after the company's collapse, Kirch claimed Breuer's comments prevented a rescue of KirchMedia, part of which would have involved Walt Disney Co. taking over Kirch-controlled German network Pro7.
Deutsche Bank has always claimed that KirchMedia, which was massively in debt in 2002, would have gone bust in any case.