Expatica news

Deutsche chief takes witness stand

22 January 2004

DUESSELDORF – In what is billed as Germany’s biggest ever corporate trials, Deutsche Bank CEO Josef Ackermann took the witness stand Thursday, quoting from German classical poetry to plead his innocence of wrongdoing in Vodafone’s takeover of Mannesmann corporation.

“I have always steadfastly adhered to the letter of the law,” Ackermann told Dusseldorf State Court on the second day of proceedings.

Ackermann is accused of improperly authorizing DM 111 million (EUR 57 million) in payouts to executives of Mannesmann, a successful German phone company that has now been absorbed into multinational Vodafone.

The payments were authorized by the Mannesmann oversight board as Vodafone took control in a high-profile takeover battle. Among the board members was Klaus Zwickel, who at the time headed Germany’s second largest labour union, IG Metall.

Zwickel and Ackermann are among four former executives facing charges. The group includes Klaus Esser, the former Mannesmann chief executive, who has since used his payout to become a partner in General Atlantic, a venture capital business.

In the witness stand Thursday, Ackermann quoted from classical German playwright and poet Friedrich Schiller’s “Fiesco” to explain why he and his co-defendants agreed on generous pay-outs for Esser.

“What were we supposed to do?” Ackermann asked the court. “Were we simply to tell Klaus Esser after months of hard work, as the poet said, ‘The Moor has done his work, the Moor may go’? No, I think not.”

Ackermann’s lawyer, Eberhard Kempf, meanwhile conceded in an interview that his client had made one mistake during his tenure on the Mannesmann supervisory board.

In the weekly Die Zeit, he said Ackermann had failed to prevent supervisory board chairman Joachim Funk from casting a vote at a 4 February 2000, meeting authorizing Funk’s own bonus. Funk is among the group facing charges.

“That was a mistake you make when busy, and Ackermann says, ‘I should have noticed it, but I didn’t catch it at that moment’.”

Kempf said the error was not enough to find Ackermann guilty because the committee again met on 17 April 2000 and confirmed the payment of EUR six million to Funk without Funk voting.

Ackermann was defiant in remarks to reporters outside the courthouse after the first day of proceedings.

“This is the only country in the world where successful people who create value are hauled before the courts over this sort of thing,” he said.

“I’m certain the verdict will be that I did the right thing,” said Esser outside the court.

The defendants are accused of breaching their fiduciary duty to the Mannesmann company by paying out disproportionate rewards to executives.



Subject: German news