Deutsche Bank Wins Ruling Overturning $49 Million Award
Deutsche Bank AG (DBK) won an appeal overturning a Singapore ruling ordering it to pay former client Chang Tse Wen $49 million for negligence in advising him on his investments.
Singapore Chief Justice Sundaresh Menon, writing for a three-judge panel of the city state’s top court, said in yesterday’s judgment that the bank can recover $1.79 million it originally sought from Chang in a 2009 lawsuit.
Chang, a Taiwanese scientist who invented the Xolair asthma drug, had won the lower court case last year after countersuing Deutsche Bank over his losses on bets on companies like Citigroup Inc. The bank didn’t have a duty in advising him on managing his portfolio, the court said in yesterday’s ruling.
“DB was dealing with a customer who had considerable means and an evident understanding of what he was doing and why,” the three-judge panel said. The bank didn’t make misrepresentations to Chang, it said.
Chang had said he “entrusted” the bank with part of the $118 million he made from selling his company, Tanox Inc., to Genentech Inc. in 2007.
The scientist was a “sophisticated man” who ignored the advice of his banker to diversify his investments, Deutsche Bank’s lawyer, Ang Cheng Hock, had argued.
Chang’s lawyer Muralidharan Pillai declined to comment.
“Deutsche Bank is pleased with the judgment and that this matter is now resolved,” said Michael West, a Hong Kong-based spokesman at the German lender.
BNP Paribas SA’s wealth management unit last year won dismissal of a Singapore lawsuit filed by a former client, claiming the bank was negligent in advising him. The former client had signed agreements with the bank stating he had sufficient financial knowledge and wouldn’t rely on it for advice.
The appeal case is Deutsche Bank AG v Chang Tse Wen, CA164/2012. Singapore Court of Appeal.
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