"Class actions" in Germany – KapMuG 2.0

Reform of the KapMuG - light at the end of the tunnel?

After a heated debate, the new reform of the Capital Markets Model Case Act (Kapitalanleger- Musterverfahrensgesetz, KapMuG) has finally been passed by parliament and will soon come into force. In the reformed version of the law, which is now no longer time-limited, significant adjustments in the areas of suspension of proceedings and access to evidence point the way towards increased efficiency and the strengthening of the balance between the opportunities afforded to the parties involved in the proceedings (i.e., equality of arms).

119 institutional investors, accused the French company Vivendi of having disseminated false or misleading information between 2000 and 2002, thereby causing them an important stock market damage.

As part of DRRT's continued support for the Boys & Girls Clubs of Miami-Dade, DRRT recently participated in the 13^th Annual Claws For Kids event. 

The enactment of the German Capital Markets Model Case Act (Kapitalanleger-Musterverfahrensgesetz – KapMuG) in 2005 was intended to make it easier for shareholders and investors to bring claims based on false, misleading, or omitted public information by publicly traded companies. In the nearly twenty years since its inception, only a handful of cases in Germany have concluded for the benefit of investors, mainly the historic Deutsche Telekom and Hypo Real Estate settlements in which DRRT player a major role. The Court’s open interpretation of the requirements to prove standing has increased the complexity and time horizon of cases. However, recent developments allow investors to gain confidence in the German system. 

On Wednesday, February 7, 2024, over 130 institutional shareholders served ING Groep NV (“ING”) and certain former directors of ING with a writ of summons claiming over €600 million in damages caused by ING’s failure to properly inform the market of material information relating to ING Bank N.V.’s (“ING Bank”) alleged corrupt practices and violation of anti-money laundering laws.  This lawsuit follows the €775 million fine ING paid to the Netherlands Public Prosecution Service (Openbaar Ministerie) (the “NPPS”) in 2018 for violations of anti-money laundering laws.

DRRT's Managing Partner, Joseph Gulino, spoke at a Webcast hosted by Investment & Pensions Europe. The webinar "Class Actions: Trends In Securities Litigation" discussed various considerations investors should evaluate when participating in loss recovery efforts worldwide. 

DRRT is delighted to contribute to Investment & Pensions Europe's "Class Actions: A Guide for Pension Funds and Asset Managers". 

On November 2, 2022, the U.S. Securities and Exchange Commission (“SEC”) adopted rule and form amendments to enhance the information that registered funds currently report about their proxy votes, in addition to requiring fund managers to report how they voted on executive compensation matters, or “say-on-pay” votes. Some of the measures to enhance reporting include requiring funds to present voting matters in a particular order and organizing them into several different categories, as well as disclosing how many shares were loaned and not recalled (and thus not voted).

DRRT was honored to support and participate in the Improve conference on November 25, 2022. The conference provided insight into protection of the equity, from finances to real estate.

Our Managing Partner Mr. Gulino participated in a panel titled "Class action and investment damage protection instruments", in which he discussed Class Action - The American Model, investment damage protection tools in the United States, and the available loss recovery mechanisms.

The conference addressed the weaknesses of the financial systems that affect retail and institutional investors around the world, the damage assessment, and effective tools to protect investors. 

DRRT is launching an update to its Global Investor Protection System (GPS).

Launched in 2011, DRRT's GPS provides investors with a comprehensive view of all securities loss recovery matters worldwide.