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DGAP-News: ORCO Germany S.A. / Key word(s): Legal Matter ORCO Germany wins Leipziger Platz litigation against HGHI

25.11.2013 / 08:45

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ORCO Germany wins Leipziger Platz litigation against HGHI

Berlin, 25 November 2013. ORCO Germany, one of the leading real estate companies in Berlin, wins its litigation against HGHI. On 14 November 2013, the regional court of Berlin (Landgericht Berlin) dismissed all claims that HGHI 1 LP GmbH and HGHI 2 LP GmbH, subsidiaries of High Gain House Investments GmbH ('HGHI'), represented by Mr. Harald Gerome Huth, had brought against a subsidiary of ORCO Germany, ORCO Immobilien GmbH ('ORCO Germany'), regarding the Leipziger Platz development.

In 2007, ORCO Germany initiated the redevelopment and revitalization of the remaining unfinished corner of Leipziger Platz so that it could become Berlin's largest commercial project. ORCO Germany launched the urban planning competition and obtained the approval of the building plan and increased useable space. As a result of ORCO Germany's efforts, Leipziger Platz could be developed.

Thereafter, in 2009 ORCO Germany sold the project to HGHI. As part of the contractual obligations of the sale, HGHI must pay ORCO Germany EUR 30 Mio. upon the sale and transfer of the Leipziger Platz entity or at the latest by 9 June 2015. In addition, ORCO Germany deposited funds into an escrow account to cover potential costs arising from pending third party litigation associated with the Leipziger Platz project.

In 2012, HGHI claimed it was entitled to EUR 9 Mio. of the funds deposited into escrow and sued ORCO Germany to release those funds to HGHI. ORCO Germany argued that HGHI's claims were fully unfounded.

During live court proceedings held on 14th November with the parties present, the regional court informed Mr. Huth that the claims of HGHI were not legally justified and proposed to Mr. Huth a settlement proposal with ORCO Germany, which Mr. Huth did not accept. As such, the regional court terminated the conciliation hearing, dismissed with immediate judgement all of HGHI's claims against ORCO Germany, and ordered HGHI to bear ORCO Germany's costs of this proceeding. HGHI can appeal the decision.

ORCO Germany follows the development of the Leipziger Platz it initiated with great interest and pride and looks forward to the full recovery of both the escrowed funds and the EUR 30 Mio due at project sale. This would enable us to further invest in our Berlin portfolio and to increase our commitment to the German capital city.

Originally posted here:
PRESS RELEASE: ORCO Germany wins Leipziger Platz litigation against HGHI