Tue, Jan 11, 2011 | 14:01 GMT
JoWood suing Koch over underpayment of 6.4 million company shares
Publisher JoWood, which filed for insolvency earlier in the month, has filed a lawsuit against Koch Media claiming the firm underpaid for 6.4 million JoWood shares back in 2006.
On January 7, JoWood announced it had failed in its efforts to acquire more capital and equity and had therefore filed with Vienna’s commercial court an appeal for capital reorganization.
JoWood believes it can sort out its credit issues within 90-days, however, a final court decision regarding the Koch suit could result in “tedious proceedings that could last for several years.”
The company is claiming Koch owes it €2.36 million ($3.04 million), plus interest as, according to a report from GI.biz, the the underpayment of the shortfall was “perhaps not committed knowingly,” as JoWooD recalculated the worth of its account receivables – which Koch offered as in exchange for the 6.4 million shares.
“With a view to JoWooD’s strained financial situation and based on corporate law considerations, the company’s management board today decided to file the law suit in the company’s and its shareholders’ interest,” read a statement from the publisher.
According to Austrian corporate law, Koch could be liable for the shortfall “irrespective of fault.
JoWooD and Koch were involved in legal proceedings together once before, back in 2008, but ended up settling the matter.