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Ecclestone future hangs on trial verdict

NEWS STORY
09/01/2014

Formula One boss Bernie Ecclestone has revealed that a £240m ($400m) lawsuit against him will get the red light if he wins a High Court trial which finished last month writes Christian Sylt in the Independent.

German media rights firm Constantin Medien claimed in court that Ecclestone and his Bambino family trust paid a £26.7m ($44m) bribe to undervalue a 47.2% stake in F1 when it was sold by German bank BayernLB to private equity firm CVC in 2006. The money was paid to BayernLB banker Gerhard Gribkowsky and Constantin says that in return he steered the sale of F1 to CVC as it had agreed to retain Ecclestone as the boss of the sport.

CVC bought the stake for £494.8m ($814m) but Constantin says other buyers would have paid more. It claims that it lost out since it had an agreement with BayernLB which entitled it to 10% of the proceeds if the stake sold for more than £670m ($1.1bn).

Constantin sued Ecclestone, Gribkowsky, Bambino and its former legal adviser Stephen Mullens for £85.3m ($140.4m) in damages and judgement in the case is due early this year. It could be a watershed moment forEcclestone.

In the last few days of the Constantin case BayernLB won access to the documents from the trial and a spokesman announced that the bank "expects to file suit against [Ecclestone] in the High Court in London in January 2014." Like Constantin, it claims that the F1 stake was undervalued and it is understood to want £240m in damages.

When asked whether he expects BayernLB to take legal action if the judge in the Constantin trial rules that the stake was not undervalued, Ecclestone said "No. BayernLB are waiting for a settlement. I think they think that this [judgement] is not going to come out until February or March and they have plenty of time to cause trouble."

Ecclestone says that he would not settle with BayernLB and may force the case to be heard even if it has been ruled that the stake was not undervalued. "It might go ahead. I might insist it does. I don't know why it has taken all this long [for BayernLB to take legal action]."

In 2012 a German court sentenced Gribkowsky to eight-and-a-half years in prison for receiving the alleged bribe and in May Ecclestone was charged with paying it. German prosecutors have said that they will make a decision this year on whether to bring him to trial.

If Ecclestone loses the Constantin suit it increases the chance that he will be put on trial in Germany. It would also play into the hands of the Bluewaters investment fund which claims that it placed the highest bid for F1 in 2006 and is suing Ecclestone in the New York Supreme Court.

Ecclestone, Bambino and Mullens deny that the payment was a bribe and say that Gribkowsky threatened to make false allegations about Ecclestone's tax affairs if the money had not been paid.

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