Commerzbank has today (26 April) lost its appeal in its high-profile four-year battle over unpaid bankers’ bonuses – one of the largest cases against a bank to run since the credit crunch.
Represented by Linklaters, Germany’s second largest bank will have to pay €52m to 104 London-based bankers, unless it obtains leave to appeal to the Supreme Court.
Stewarts Law head of commercial litigation Clive Zietman represented 83 of the claimants, alongside 4 Pump Court’s Nigel Tozzi QC. Mark Levine, employment partner at Mishcon de Reya, and Andrew Hochhauser QC acted for the remaining 21. Commerzbank turned to Linklaters employment partner Nicola Rabson, instructing Matrix Chambers’ Thomas Linden QC.
All three judges at the Court of Appeal – Lord Justice Maurice Kay, Lord Justice Elias and Lord Justice Beatson – upheld an earlier High Court decision that Commerzbank had breached its contractual obligations by failing to pay retention awards promised to Dresdner Kleinwort (now part of Commerzbank) employees.
Commerzbank, when it took over Dresdner in 2009, claimed the bonus promises were not bound by law. This was despite a verbal announcement made by Dresdner Kleinwort’s, chief executive officer Stefan Jentzsch for its investment banking division in April 2008, which claimed there was a guaranteed minimum bonus pool of €400m for that year.
The retention pool was formally approved at a board meeting where members clarified that revenues of an estimated €2.3bn formed the basis of a €400m cash pool.
Zietman said: ‘This is not just a victory for my clients. It is a triumph for common sense and for some very well established principles of English contract law. It is a great pity that the bank saw fit to contest so vigorously and for so long, a case that could so easily have been avoided.’
Kingsley Napley employment law partner Andreas White commented: ‘Given the huge sums at stake, Commerzbank is bound to attempt an appeal to the Supreme Court, but the bank’s patience with employment litigation may be wearing thin.’
The bank also lost the employment tribunal case against former employee Latifa Bouabdillah earlier this month, who was dismissed after not informing the bank about suing her previous employer and rival Deutsche Bank for discrimination. email@example.com