Civil litigation has begun in Hamburg against former members of the Management Board and Supervisory Board of the agricultural group KTG. Insolvency administrator Stefan Denkhaus is demanding a total of 189 million euros in damages from former boss Siegfried Hofreiter and seven other managers. The Hamburg Regional Court must now clarify whether Hofreiter & Co. played down the desolate situation of KTG Agrar at the expense of the creditors and delayed the insolvency by one year. During this period, 189 million euros were still invested in the company.
When the partner monitors the CEO
According to media reports, the defendant’s manager liability insurance (D&O) – taken out with Allianz and Dual Deutschland – only covers 40 million euros. However, in view of current case law, it is doubtful whether the insurance industry will even be liable for payments after insolvency has occurred. Until bankruptcy in 2016, KTG Agrar was Germany’s largest agricultural group with 800 employees and more than 46,000 hectares of cultivated area. Hofreiter’s partner and an entrepreneur who did business with KTG sat on the company’s three-member Supervisory Board.