Bertelsmann settles with two former exex
BERLIN — German media giant Bertelsmann has settled a E160 million ($193 million) lawsuit filed by two former managers in connection with its stake in AOL Europe three years ago, the group said.
Company agreed to pay plaintiffs Jan Henric Buettner and Andreas von Blottnitz after deciding not to appeal a California court decision handed down in February ordering Bertelsmann to compensate the two former employees for their involvement in the group’s joint venture with America Online.
Bertelsmann sold its 49% stake in AOL Europe in 2001 to AOL Time Warner for $6.75 billion.
“The decision to settle is business-based,” Bertelsmann attorney Ulrich Koch said Monday. “Continuing a legal process against the plaintiffs would have resulted in a great commitment of time, resources and personnel. The settlement is no admission of liability.
“We firmly believe in the legitimacy of our position: The final judgment reflects neither the facts nor German law, which applied in this case. The case should have been tried before a German court right from the start,” he said.
The settlement is well below the $253 million judgment plus interest issued by the court. Since the group had formed a provision of some $280 million for the lawsuit last year, the group will see a $90 million spurt in its earnings this year.
Buettner and von Blottnitz, who began managing AOL Europe in the mid-1990s, claimed they had been promised a stake in the joint venture by Bertelsmann’s then-chief exec, Thomas Middelhoff, but never received shares in the company or proceeds from the sale.
The jury in the trial found that Bertelsmann breached oral and written contracts with Buettner and von Blottnitz, who live in Santa Barbara County, Calif.