Dutch civil service scheme ABP says it could receive ‘millions’ from TimeWarner in compensation for accounting irregularities which caused a steep fall in the US media group’s share price.
ABP, Europe’s largest pension scheme, is suing TimeWarner over inflated results at America Online, which merged with TimeWarner in 2001. The share price dropped after the transaction.
According to ABP’s head of legal advice Rene Maatman, the €178bn pension fund has made a claim of $200m. But it is unrealistic to expect the full amount to be paid, he indicates.
Recently, TimeWarner decided to set aside $3bn for settlements with investors. A reservation of $600m has been made for individual cases.
“By suing on an individual basis, ABP reckons on receiving more compensation then by joining a collective class action,” Maatman says.
He says the fund recently won $4.5m in compensation in an individual case against drugs firm Bristol-Myers Squibb. It would have won $.75m in a collective suit.
“ABP has similar court cases pending against Nortel, Qwest and Delphi, from which it claims $100m, $100m and $14m respectively,” Maatman says. The scheme is being supported by a group of legal advisers in the US.