Clifford Chance, in collaboration with DLA Piper, has obtained a judgment in favour of Energis plc that saw Alexander Falk ordered to pay damages of EUR 208 million.
LawFuel.com – International Law Newswire – On 20 September 2012, the 27th Civil Division of the Regional Court of Hamburg delivered its long-awaited judgement in the case that pitted Energis plc against Alexander Falk. The court ordered Alexander Falk and Alexander Falk Holding GmbH to pay Energis plc EUR 208 million in damages. This brings an end to the litigation, for the time being, stemming from a dispute between Energis plc and Alexander Falk which has played out before the criminal courts since 2003, as well as the civil courts since 2004.
The case revolved around accounting fraud initiated by Alexander Falk and several accomplices at ISION Internet AG in the lead up to its sale to Energis plc in 2000. Undisputable evidence of accounting fraud in the key integrated solutions and hosting segments which has since come to light formed the basis for an ad hoc notification released by the company containing knowingly false information on which Energis plc had based its decision to purchase ISION Internet AG. Energis plc relied on the accuracy of this information in subsequently purchasing approximately 75% of the shares in ISION gains against a cash component of EUR 208 million, as well as a significant stock component.
Energis plc, which had already received a ruling in its favour back in 2004 with motions brought to seize Alexander Falk’s assets, says that it was totally vindicated by this ruling. On the back of Alexander Falk having previously been convicted of attempted fraud by the 20th Superior Chamber for Criminal Matters of the Regional Court of Hamburg and sentenced to four years in prison for committing fraud which adversely affected Energis plc, the civil chamber now held that Energis plc had suffered economic loss as a result of its purchase of ISION Internet AG and was entitled to claim damages in the amount of the purchase price paid.
Sebastian Rakob, partner at Clifford Chance and the firm’s lead advisor on the proceedings from the outset, commented that “it has been well worth the wait for our client, Energis plc”. He added that “the Regional Court fully rejected the objections made by the other side and held that the claimant may demand to be put in such financial situation as it would have been in had the purchase agreement never been concluded. It demonstrates that it is possible to demand restitution for losses/damage caused even in the most complex cases involving white collar crime.”
The Clifford Chance team was led by partner Sebastian Rakob and comprised partner Uwe Hornung, as well as senior associates Sybille Haas and Dr. Beatrix Elsner (all Litigation, Frankfurt).