Deutsche Telekom Liability in $794 Million Suit Doubted by Judge

Deutsche Telekom AG got a boost in its fight against a 612 million-euro ($794 million) damage suit by the founders of competitor Telegate AG, after a judge voiced doubts on the merits of the case.

Klaus Harisch and Peter Wuensch may not be entitled to claim compensation for the depressive effect that Deutsche Telekom’s overcharging for directory data had on Telegate shares they sold, Presiding Judge Rainer Hahn said at a hearing in Cologne today. The men are claiming damages that would have been incurred by the company and not them individually, Hahn said, as he gave his initial view on the case.

“What the plaintiff seeks is a mere refection of the company’s damage” and in such a situation, “the law doesn’t allow them to seek any payments,” said Hahn. “That’s my preliminary view of the issue but I want to stress that this court will still deliberate and reserves to rule in any way it seems fit in the end.”

Deutsche Telekom has fought complaints for years by directory service providers who said they were being charged too much for the services and data that Germany’s former phone monopoly was legally obliged to provide.

The country’s top civil court this year backed two lower court rulings requiring Deutsche Telekom to pay back a combined

97.2 million euros in overcharged fees and legal costs.

The Cologne court today also heard another case by Telegate seeking an additional 86 million euros in damages. The Munich-based company argues that Deutsche Telekom’s overcharging curbed profits.

Hahn told Telegate’s lawyers they have to show their business plans from the time the alleged lost profits were incurred.

‘Wishful Thinking’

“Lost profits may not consist of wishful thinking only,” said Hahn. The court scheduled a ruling for April 16.

Georg Jochum, a lawyer for Telegate and the two founders, said the court has taken a debatable view of the law. The case may end up in German’s top civil court unless Hahn and his two colleagues change their minds, he said after the hearing.

Deutsche Telekom lawyer Joachim Schuetze told the court Telegate tries to “dress up the figures” by claiming it would have made more money. He asked the court to dismiss the cases.

Telegate is majority owned by Italy’s Seat Pagine Gialle SpA.

Today’s cases are LG Koeln, 87 O 7/06 and 87 O 8/06.

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