29 October 2013
Ecclestone back in court
Civil proceedings alleging that Bernie Ecclestone bribed German banker Gerhard Gribkowsky to undervalue the cost of F1 rights are due to get underway in London today [Tuesday], as new Swiss investigation opens.
F1 overseer Bernie Ecclestone will return to the courtroom, in name at least, as the latest stage in the ongoing saga over the sale of F1 rights to CVC comes in front of a judge in London.
The civil case, which will be heard at the High Court, hopes to determine whether Ecclestone's family trust paid a £27m bribe to now disgraced German banker Gerhard Gribkowsky in a bid to smooth the sale. Constantin Medien, which, through its interest in BayernLB, held a stake in F1 prior to CVC's involvement, alleges that Ecclestone conspired with Gribkowsky to undervalue their holding and are seeking damages exceeding £100m.
Gribkowsky was jailed for eight years by a German court for accepting the alleged bribe, but Ecclestone has yet to be charged with any wrongdoing, insisting that he was being 'blackmailed' by the German amid threats that he would disclose details of the Briton's tax affairs.
Gribkowsky joins Ecclestone, the 83-year old's former lawyer Stephen Mullens and family trust Bambino Holdings as defendants in the case, which is expected to last around three weeks. All are expected to argue that they did not attempt to deliberately defraud Constantin Medien by agreeing a lower price for the stake. Ecclestone is scheduled to give evidence some time next week, while CVC managing partner Donald Mackenzie is also expected to take the stand. Mackenzie is not implicated in the case.
Ecclestone has also been indicted on similar charges by German authorities, but that hearing, originally scheduled for September, has now been rescheduled for early in 2014 after his lawyers successfully petitioned for an extension to the time that they had to make submissions to the court.
In the last 24 hours, it has also emerged that the octogenarian could also face legal proceedings in Switzerland, with the Financial Times reporting that prosecutors have begun a criminal investigation into the bribery affair.
The move was apparently 'triggered by the receipt of third party complaint', with the investigation set to attempt to establish the facts of the case, whether it falls under Swiss jurisdiction and whether the payment was criminal under Swiss law.
The bribery issue has hung over Ecclestone for most of 2013 and led to rumours that the 82-year old might finally be forced to step down from his role as the head of F1. He retains the backing of CVC, although the financial giant says that it continues to monitor the situation. The company, which assumed control of F1's commercial rights in 2006, and retains control of the sport despite recent disposal of some of its holding, has been linked to a $2bn bid for media rights agency IMG Worldwide, apparently linking up with Mumtalakat and the Abu Dhabi Investment Authority to make a play for a 60 per cent stake currently owned by private equity firm Forstmann Little.
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