Judge Known as ‘Bank-Scourge’ to Testify at Fitschen Fraud Trial

The appellate court judge who said Deutsche Bank AG executives hadn’t told the truth about the firm’s dealings with media entrepreneur Leo Kirch will testify this week in the criminal case triggered by his ruling.

Guido Kotschy, a 66-year-old jurist who helped transform a long-shot lawsuit by the now dead media mogul into a 925 million euro ($1 billion) settlement will answer questions about the attempted fraud cases against Deutsche Bank co-Chief Executive Officer Juergen Fitschen and four other officials in Munich Wednesday.

Fitschen, former CEOs Josef Ackermann and Rolf Breuer and two other former officials are accused of trying to deceive Kotschy and the other judges on the appellate panel to fend off the 2 billion-euro claim by Kirch. When bank executives testified in 2011, Kotschy questioned their truthfulness, prompting prosecutors to investigate.

“The press calls him a ‘bank-scourge,’” said Andreas Tilp, a lawyer for investors who recently won an unrelated ruling against Hypo Real Estate AG in Kotschy’s court. “It’s certainly true that my colleagues who represent banks aren’t exactly thrilled with him.”

The criminal trial, which started in April, has been playing out against a backdrop of turmoil at Frankfurt-based Deutsche Bank. Earlier this month, Fitschen and Anshu Jain said they would step down as co-CEOs as the lender battled a litany of legal issues, from tax probes to regulatory fines. Prosecutors in Frankfurt yesterday said they are investigating bank employees over the Libor-rigging scandal.

Breuer Interview

Kotschy’s panel in 2012 ruled Deutsche Bank was liable for the collapse of Kirch’s group after Breuer questioned its creditworthiness on Bloomberg TV in 2002. Kotschy and two other judges believed the interview was part of a plan to force Kirch to hire the bank for restructuring work. Prosecutors filed their charges last year based on that ruling.

To avoid losing the civil suit in 2011, the bank officials denied there was any such plan, according to prosecutors. Fitschen is accused of failing to stop inaccurate filings from being submitted to the court.

Deutsche Bank and all of the men have rejected the allegations.

Fitschen’s lawyer didn’t immediately return a call seeking comment on Kotschy. Lawyers for Ackermann and Breuer declined to comment.

Deutsche Bank in 2011 lost a bid to have Kotschy and his colleagues removed from the civil case. The judge extended his term beyond the regular retirement age and was able to stay on the matter.

‘Truly Independent’

Tilp describes Kotschy as a “character” and “truly independent,” but admits he hasn’t been immune from the judge’s ire.

“He’s had a go at me, too,” Tilp recounts. “He’s the type whose face quickly turns red of agitation.”

Judge Kotschy declined to comment.

If lawyers for Fitschen and the other defendants are looking to counter Kotschy, they may need to look no further than Peter Noll, who is presiding over the criminal trial.

Noll, 54, has a reputation as a diligent judge among prosecutors and defense lawyers alike. He likes to joke and make barbed comments.

At several Fitschen trial hearings, Noll said prosecutors didn’t disclose files in a timely fashion, adding that this may jeopardize the fairness of the proceedings. Normally, defense lawyers seize on such remarks to ask for a mistrial, generally a big setback for prosecutors.

But none of the defense lawyers did. Fitschen’s attorney Hanns Feigen said they would rather keep Noll.

Proceed With You

“We want to proceed with you,” Feigen told the court in May.

The Deutsche Bank case is the last Noll will handle as a trial judge. He will move to the Munich appeals court, where Kotschy sits.

Each jurist has his own individual character, said Wolfgang Kreutzer, a veteran Munich defense lawyer.

“Kotschy is very emotional, even choleric, he scolds people at times,” said Kreutzer, who isn’t involved in the case. “Noll, on the other hand, is stoically calm, you can hardly upset him. He always has a sardonic smile on his face and likes to comment everything with irony.”

Before it's here, it's on the Bloomberg Terminal. LEARN MORE