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US ruling gives Bernie Ecclestone some legal relief

January 22, 2014

Bernie Ecclestone's legal woes were lessened slightly on Wednesday as a New York court dismissed a $650 million damages claim brought against the Formula One boss who faces trial in Germany in April over an alleged bribe. Investment firm Bluewaters brought the case against Ecclestone and defendants including private equity group CVC, the latest in a series of legal cases stemming from the sale of a major stake in the motor racing business eight years ago. Supreme Court judge Eileen Bransten ruled that " New York was not a convenient forum for the dispute," adding it should be settled by English or German law. The ruling was dated January 16 but was only made public by the court this week. Ecclestone stepped down from Formula One's management board following his indictment in Munich last week, threatening his position at the top of the sport which he has held almost unchallenged for the last four decades. Although the billionaire businessman will continue to run Formula One on a "day-to-day basis", he will be subject to increased oversight and will no longer have the authority to approve and sign "significant contracts". The case in New York revolved around the $830 million sale of a 47 percent stake in Formula One to CVC by German bank BayernLB. Bluewaters alleged that it was the highest bidder and that Ecclestone had favoured a sale to CVC because it planned to keep him on as chief executive of a business he built into a global money-spinner. Ecclestone, 83, is waiting to hear the outcome of a $100 million damages claim brought in London by a German company which says it too lost out because of the CVC deal. He will go on trial in Munich in April after being charged with bribing former BayernLB banker Gerhard Gribkowsky to smooth the sale to CVC. Ecclestone denies wrongdoing and says he was the victim of coercion by Gribkowsky. The 83-year-old assured Formula One's board last week that he is "innocent of the charges" and will "vigorously defend the case" when it goes to court. The Formula One supremo faces charges of bribery and incitement to breach of trust with a $44?million payment to Gribkowsky. Bribery convictions in Germany can result in prison sentences of three months to 10 years. Ecclestone's lawyers in Germany , Sven Thomas and Norbert Scharf , said on Thursday that "the alleged bribery did not happen". "The accusations in the indictment based on Gribkowsky's statement are unfounded and do not… add up to a coherent picture," they added. The German banker was convicted in 2012 of taking the payment from Ecclestone in connection with the undervaluation and sale of a 47 per cent stake in Formula One to CVC in 2006. He was sentenced to 8½ years in prison for corruption, tax evasion and breach of trust.


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Source: Legal Monitor Worldwide


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