FRANKFURT (Reuters) - Deutsche Bank will seek compensation from former chief executive Rolf Breuer for a costly out-of-court settlement reached earlier this year with the heirs of the Kirch media empire, according to a report in the newspaper Die Welt.
The bank’s supervisory board this week decided to seek compensation from Breuer, the newspaper reported, adding that the bank still expected to pay most of the settlement itself.
“The large part of the settlement will definitely stay stuck with the bank,” the paper said, quoting a person familiar with the supervisory board discussions.
A Deutsche Bank spokesman declined to comment on the report. Attempts to contact a spokesman for Breuer were unsuccessful.
Deutsche needs to seek compensation from Breuer before so-called directors and officers’ liability insurance can play a role in covering some of the settlement charges, the paper said.
In February, Deutsche Bank ended a 12-year battle with the heirs of media mogul Leo Kirch, closing one of Germany’s most acrimonious corporate disputes in a deal costing the country’s largest lender about 925 million euros ($1.24 billion).
Kirch, who died in 2011, blamed the bank for his group’s demise.
Kirch had claimed that ex-Deutsche chief executive and later chairman Breuer triggered his media group’s downfall by questioning its creditworthiness in a 2002 television interview. Kirch sought for years to recoup about 2 billion euros in damages.
In 2002, while he was participating in the World Economic Forum at New York’s Waldorf-Astoria hotel, Breuer appeared to raise questions about Kirch Group’s creditworthiness during a TV interview.
Breuer was also then chairman of Germany’s private-sector bank association. Kirch argued that the comments amounted to a signal for other creditors to discontinue funding.
The family later argued that the statement was part of a deliberate scheme to force Kirch into bankruptcy so that the bank could reap hefty fees helping the group to restructure.
Deutsche Bank and its executives have denied that Breuer’s comments led to the collapse of the Kirch empire.
But the case has occupied lawyers, the courts and the media for years, with Germany’s constitutional court getting involved at one point, and has led to a number of additional lawsuits or criminal investigations.
($1 = 0.7447 Euros)
Reporting by Thomas Atkins; Editing by Stephen Powell