100 London bankers sue Germans over unpaid £42m in bonuses
Saturday 21 January 2012
More than 100 London bankers will next week go to the High Court to sue German banking giant Commerzbank over €50m (£42m) in unpaid bonuses.
The case involving 104 former Dresdner Kleinwort investment bankers threatens to be explosive as it comes amid continuing political anger about City pay in Britain and Germany.
The aggrieved bankers claim Dresdner bosses guaranteed a €400m bonus pot at a town hall meeting in London in August 2008 to ensure the loyalty of staff, just weeks before the global banking crisis that saw Lehman Brothers collapse.
But Commerzbank, which took over Dresdner later that year, slashed the bonuses by 90 per cent, citing a "material adverse change" as the bank needed a €6bn bailout from the German government.
The 104 bankers began their legal action in 2009 and will now have their claims heard in a full case after the Court of Appeal rejected Commerzbank's request for summary judgement, without a hearing.
Some of the bankers are thought to be demanding seven-figure sums, including interest, while others are claiming just tens of thousands of pounds.
Solicitors Stewarts Law represents 83 of the bankers while the remainder are represented by Mishcon de Reya. Commerzbank has hired legal heavyweights Linklaters.
Clive Zietman, head of commercial litigation at Stewarts Law, said: "Although there might be people who want to politicise it, English contractual law will apply."
A Commerzbank spokesman said: "During the forthcoming case, Commerzbank will show that Dresdner Bank was entitled to reduce its employees' 2008 discretionary bonuses in the light of the significant deterioration in the investment bank's performance in late 2008. As the new owner of Dresdner Bank, Commerzbank plans to mount a vigorous defence to all the claims made against it."
The case begins on Monday, but barristers are not expected to make opening statements in court until Wednesday in the hearing, which could last four weeks.
In a sign of its intent, Commerzbank previously used top barrister Jonathan Sumption, one of the most expensive silks in London. But QC Tom Linden will now act for Commerzbank as Sumption has become a Supreme Court judge.
QCs Nigel Tozzi and Andrew Hochhauser are acting for the 104 bankers.
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