DGAP-News: ROTTER Rechtsanwälte Partnerschaft: Higher Regional Court of Karlsruhe orders review of the annual financial statements of MLP AG
(firmenpresse) - ROTTER Rechtsanwälte Partnerschaft / Legal Matter
02.08.2010 08:00
Dissemination of a Financial News, transmitted by
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Within the framework of the model case proceedings against MLP AG, the
Higher Regional Court of Karlsruhe, in a now disclosed decision, ordered an
expert review of MLP's accounting practice in the years 1999, 2000, 2001
and 2002
Since 2007, the law firm ROTTER Rechtsanwaelte ('ROTTER') has been
conducting a large number of suits for damages on behalf of former staff
members and customers of MLP in the aggregate amount of currently EUR 34.7
million against MLP AG and its former chairman of the board, Dr. Bernhard
Termuehlen, who in the meantime was appointed chairman of the supervisory
board of the financial services provider Mayflower Capital AG. In a
decision issued on 30 December 2008, the Regional Court of Heidelberg
introduced model case proceedings under the Capital Markets Model Case Act
('Kapitalanlegermusterverfahrensgesetz'). On 23 February 2009, the Higher
Regional Court of Karlsruhe selected a model claimant who is represented by
ROTTER.
Subject-matter of the proceedings is the accounting and reporting practice
of MLP AG in the years 1999 to 2002. In the claimants' opinion, MLP AG and
Dr. Bernhard Termuehlen deliberately manipulated the company's annual
financial statements in order to make investors believe that MLP's annual
profit growth in the years 1999 through 2002 actually was 30%. Pretending
such alleged profit growth of 30% was only possible, however, by illegally
refraining from making provisions for funding obligations of MLP for
factoring transactions of the then group subsidiary MLP
Finanzdienstleistungen AG. According to the claimants, this failure caused
the required, but indeed not posted provisions to accumulate; such
accumulation was resolved by posting provisions unrelated to the accounting
period in the amount of EUR 120.1 million in the financial statements of
2002 in order to adjust the balance sheet to the real situation. As a
result of such adjustment, MLP AG could not report any profit growth for
the financial year 2002, but instead a negative result from ordinary
operations of minus EUR 36.6 million. Following the announcement, valuation
of the company by the financial markets collapsed.
According to the claimants, the long-term chart of the MLP stock shows very
clearly that the company's valuation by the financial markets in the years
1998 through 2002 resulted from the claimed manipulation. At the time, the
public prosecutors of Mannheim had brought a charge against the former
chairman of the board Termuehlen for suspicion of balance sheet
falsification, and Termuehlen could only avoid public criminal proceedings
by paying a fine.
In its now published decision issued on 22 June 2010, the Higher Regional
Court of Karlsruhe orders the above-described issues to be examined by an
expert. 'We expressly welcome this decision' said Klaus Rotter, 'as this
allows the issue of balance sheet manipulation by MLP AG and Dr. Bernhard
Termuehlen to be clarified by a higher and, if necessary, by the highest
German civil court'.
Prior to this decision,the Higher Regional Court of Karlsruhe, in the
hearing of 4 May 2010, had explained to MLP AG the considerable risks it
would run in a lawsuit and suggested rather to aim at a settlement with the
claimants. The statements of the court of decision on the prospects of
success of such actions clearly refute their assessment by the chairman of
the board, Dr. Schroeder-Wildberg, who, in MLP's annual report 2009 claims
that the actions will have no chance of success whatsoever. Therefore, MLP
AG, notwithstanding actually threatening lawsuit risks, does not believe it
is necessary to make provisions for such risks.
In ROTTER's opinion, this is another violation of applicable accounting and
reporting regulations, which could result in MLP AG being again liable for
damages to stockholders, as investors who buy shares in the Company during
the lawsuit would have paid too much, if in the end the Company loses the
case and the price of MLP's stock plunges. It must be assumed that the
result of the action will impact on the Company's stock price all the more
since MLP AG's annual profit for 2009 amounted to EUR 24 million, and the
claims for damages represented by ROTTER meanwhile accumulates to EUR 34.7
million including interest. The amount of aggregate damages to be paid by
the Company is likely to be even higher since additional claimants are
joining the proceedings.
CONTACT
The lawyers, Ms Jasmin Liebek and Mr Klaus Rotter, are available for any
questions you may have.
ROTTER Rechtsanwaelte Partnerschaft
Luise-Ullrich-Strasse 2, D-82031 Gruenwald
Telephone +49 89 64 98 45 - 0
mail(at)rrlaw.de
www.rrlaw.de
02.08.2010 08:00 Ad hoc announcement, Financial News and Press Release distributed by DGAP. Medienarchiv atwww.dgap-medientreff.deandwww.dgap.de---------------------------------------------------------------------------
Language: English
Company: ROTTER Rechtsanwälte Partnerschaft
Luise-Ullrich-Straße 2
82031 Grünwald
Deutschland
Internet: www.rrlaw.de
End of News DGAP News-Service
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Datum: 02.08.2010 - 08:00 Uhr
Sprache: Deutsch
News-ID 31855
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