Heuking Kühn Lüer Wojtek Prevails Against Predatory Shareholder in Hanseatic Higher Regional Court
May, 2020 - Germany
Dr. Frank Mitzkus, Partner at Heuking Kühn Lüer Wojtek, successfully represented his client – a Societas Europaea (SE) – before the Hanseatic Higher Regional Court. After the April 26, 2019 judgement, which has now become final, the SE successfully filed a claim for damages against a shareholder.
The shareholder had filed an action for avoidance in relation to a resolution of the general meeting, by which it had approved the sale of two subsidiaries to an international entertainment group by an overwhelming majority. The SE and its two major shareholders felt compelled to respond to various claims of the plaintiff to complete the sale of the subsidiaries, which was jeopardized by the action for avoidance. Among other things, the SE and the two major shareholders had to make payments to a good friend of the shareholder, who had claimed that he was still owed payments from the major shareholders arising from previous share sales. The plaintiff subsequently withdrew his complaint, so that it was possible to close the sale of the company.
After the sale, the SE filed an action for avoidance in relation to the agreement with the shareholder and sued him for damages. This action was successful on the grounds of intentional immoral damage (Section 826 Civil Code). In contrast to the Regional Court previously, the Higher Regional Court found that the shareholder had caused the SE to make payments to which he was not entitled in grossly self-serving manner and which he could not reasonably claim.
When an administrative appeal was not allowed by the Higher Regional Court, the shareholder filed an appeal with the Federal Court of Justice (Federal Court of Justice, II ZR 306/19). In April 2020, the shareholder withdrew the appeal so that the case is now closed and the Hanseatic Higher Regional Court’s ruling is final.
