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Ecclestone one of four defendants as court case opens in London over sale of F1
Posted By: James Allen  |  28 Oct 2013   |  3:12 pm GMT  |  46 comments

[Updated] Tomorrow in London, F1’s commercial boss Bernie Ecclestone begins the defence of a US$170m legal action against him and three other defendants, over the sale of F1 by Bayern LB to CVC in 2005 and the payments around the time of the sale, made by Ecclestone to disgraced Bayern LB employee Gerhard Gribkowsky.

Ecclestone has acknowledged making the payments, but denies they were bribes. He says that the payments were in response to Gribkowsky blackmailing him over the conduct of the Bambino Trust. The German threatened to claim to UK Tax Authorities that Ecclestone controlled the trust which would open him up to complicated tax investigations.

Ecclestone and Gribkowsky, together with Ecclestone’s former lawyer Stephen Mullens and Ecclestone’s family trust Bambino Holdings are the defendants in tomorrow’s case, which is expected to last between 20 and 25 days. Ecclestone is scheduled to give evidence in the second week. CVC’s managing partner Donald Mackenzie, who is not implicated in the case, will also give evidence.

Much information, hitherto secret, relating to F1’s income, cashflows, team payments much else which is concealed behind a curtain of secrecy will be revealed during the case.

The first three defendants will be represented by QCs and barristers. Gribkowsky, who is in a German prison serving an eight and a half year sentence for bribery, will not be represented.

The case has been brought by Constantin Medien, a former shareholder in F1, which had an interest in the sale of the F1 business, so long as the sale price was above a certain threshold, believed to be in excess of $1 billion. In fact it sold for $814, so Constantin Medien did not get its payment. When the business was valued by accountants later that year for refinancing of CVC’s loan, the value was set at $5.9 billion. Constantin Medien claims that this indicates that the true value at the time Gribkowsky sold Bayern LB’s stake should have been $2.8 billion.

After Gribkowsky’s conviction for receiving bribes from Ecclestone, which he denies, Constantin Medien launched its legal challenge in London. They have had one minor victory already when the judge in the case ordered FOM and CVC to release hundreds of documents to the plaintiff, hence the details likely to be revealed.

Former owner of F1 Constantin Medien claims that Ecclestone, his lawyer Stephen Mullens, his family trust Bambino Holdings and Gribkowsky conspired to undervalue the motor sport when it was sold to CVC Partners in 2005/6, in part through the payment of bribes.

It is also alleged that the payments were made so ownership passed to a buyer supportive of Ecclestone, who would retain him as chief executive of F1, but that this fetched a significantly lower price than should otherwise have been achieved from a sale.

It claims F1 was sold at half its real price, causing it to lose out on a profit-sharing agreement.

The defendants argue that they had no knowledge of the existence of Constantin Medien’s position relating to a sale and so could not have conspired to defraud them.

Ecclestone has also been indicted in Germany over the Gribkowsky affair, but the court in Munich has delayed until 2014 a decision on whether to bring him to trial, partly due to forthcoming regional elections and a change of judging panel and partly to see what arises from the Constantin Medien case in London.

There were suggestions in the paddock that the Munich court may have recently changed its mind and decided to call a pre-trial hearing next month, but lawyers in London said that they were unaware of such a development.

* Meanwhile Swiss prosecutors have opened an investigation into the matter.

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Murky waters. When is a bribe not a bribe? Bernie paid Gribkowsky to prevent Gribkowsky squealing to the tax people about Bambino Holdings. What is Bernie hiding that he does not want the tax people to know about? If Bernie has nothing to hide then why didn’t he call Gribkowsky’s bluff? What Gribkowsky did to Bernie was extortion. Isn’t this illegal. I am confused!


A bribe is not a bribe when you rebrand it.

For example, why call it a bribe, when you can call it a commission, or a reward, or spiff, a finders fee, etc.

Word choice…what a wonderful thing. 🙂


Sharks smell blood in the water. Who has jurisdiction in space? Can RBR build Bernie a Stratos-2 so he can live out his remaining years in space like that dude in Contact? 🙂

* Meanwhile Swiss prosecutors have opened an investigation into the matter, as Bambino has an office in Geneva.


Hm…might be more interesting than some 2013 races 😛


Like I said before in my mind there is no doubt he is guilty as sin, will he go to jail?? I don’t think so as soon as things wind up to a clear point of where his destiny is going to land legally (Ie if it is a jail sentence) I believe he will simply switch himself off. 🙁


The real laugh is that the cases are being tried by governments which are historically the best examples of fraudsters and advantage-takers.


Seemingly Ecclestone et al couldn’t be guilty of defrauding Constantin Medien because they were unaware there was a registered interest, well thats poor due diligence at best.

However seemingly they had no qualms about [mod] BayernLB in 2005…which in turn would caused the financial loss to Constantin Medien for which they surely must be liable.

Interesting the $5.6b 2005 valuation so dramatically differs from what was paid less then a year earlier $1.8b, while there was a few hundred million expended on consolidation thats still an enormous jump.

But going back to 2001 when the Kirch Group paid £600m (hoping wikipedia is correct on this one) to exercise an option to purchase a further 25% of SLEC from Ecclestone. That float valuation would have been of the order of $3.6b.

And given the present float valuation this year is estimated between $10b-$12b then there was quite some aberration that surely can’t be explained by the lack of a Concorde Agreement back in 2005. After all the same situation existed in 2013 and didn’t affect the value one iota, indeed it might be said to have increased because of it.

Now the question is what occurred in 2005 for the value of the F1 to plummet. While I’m pretty sure Justice Vos will get to the murky bottom of the conundrum, I’d like him to shed some light on just who were the ‘1999 EM-TV Bondholders’ Ecclestone paid $400m to in 2005…. Surely Mosley wasn’t involved?


Edit: For accuracy, Justice Newey will hear the case.. Justice Vos heard the preliminary disclosure appeals.


Crikey, not happy with designing cars that trounce the opposition, he’s now a judge as well :-p


I’m sure the verdict will have an aerodynamic flair to it.


Mr Ecclestone under West Minister System

will find very dificult to defend alleged

blackmail by Mr Girbkowsky,Mr Ecclstone admit

paying money to Mr Girbkowsky,which ever way one slice it,it was the wrong thing to do.

I do not know what German Law System is, I believe its similar to Roman System,should that be the case,and even should Mr Ecclstone

be found guilty he want be going to jail

under the Roman system should the guilty

person be over 75 years old he is spare of

prison,like Silvio Berlusconi the former

Italian prime Minister.

Perhaps Mr Allen will pass the coment as to

regard the German Law System.


Is it just my ignorance or has anyone else noticed little of if any or Bernie at any of the past few Gp’s??


I noticed that in India- no Bernie to come and shake the champion’s hand.


Not been at a GP since Singapore


I did like the Bernie ‘Spitting Image style’ puppets the mad fans had! Think it was in Japan.

At what point do you go, nah, I’ll leave my “Sebastian Vettel #1” cap and “Red Bull gives you wings” flag at home today and take the Bernie puppet instead!


Never underestimate the sex appeal of a Bernie puppet 😉




Very unusual!


What a truly wonderful can of worms this is!

4 God like QCs, 2 mortal barristers, 3 solicitors, plus assorted bag carriers, paper passers etc. The total hourly rate has to be around £6000 per hour at a guess.

Constanin Medien contains the Remains of EM.TV AG a company that has a special importance in the almost unbelievable roller coaster of F1 history.


…and a partridge in a pear tree.


The delay in the German case has nothing to do with the regional elections (which were held in September), but was due to the upcoming change in the chief justice, and more importantly, requests for more time by the defence team.

I don’t think Mr. Ecclestone is lying when he says that Mr. Gribkowsky tried to blackmail him over tax issues – I don’t think Mr. Ecclestone would just make it up, and it wouldn’t have been out of character for Mr. Gribkowsky, a convicted criminal who is currently facing fresh charges, including an alleged bribe of an Austrian politician.

However, the fact that Mr. Gribkowsky was a crook does not imply that Mr. Ecclestone did not bribe him, of course – maybe blackmail was just Mr. Gribkowsky’s way of making sure that Mr. Ecclestone delivered on his part of a deal.

Mr. Ecclestone should be considered innocent until proven guilty, of course, but with allegations like this, the head of any “ordinary” business would have resigned.


surely a payment in response to blackmail is a bribe?

Whichever way you look at it bernie has admitted paying a substantial sum to someone who made threats of tax avoidance being made public.

The only reason he would have done that is because he sees it as the lesser of 2 evils … in which case the UK government is owed many millions in unpaid tax. Ha – could we see the UK taking a shareholding in lieu and then sell their holding at some point?


No, not a bribe. Blackmailing someone and getting money is extortion, while a payment when blackmailed is not a criminal act per se. That’s why the Crown is not prosecuting Bernie for such a crime, and the Germans will not indict him if the prosecutors cannot prove to the Court that this was an inducement (bribe) to act in a criminal way, hence cooperation in committing a crime under the German law. In my opinion, these two cases are inter-connected, because if the fact of crime is proved in the German court, then it shall open the flood gates for civil lawsuits…

Tom Haythornthwaite

I believe *offering* a bribe to prevent an unfavorable outcome IS illegal.


Good post, indeed. However, I find that blackmail defence argument naive. Perhaps just a cynic in me. Bernie is a shrewd operator, and you do not succeed by simply blackmailing him into paying tens of millions. I think the outcome of the case will rest on the evidence the Munich prosecutors gathered. I also assume there is no hardcore proof of the plot, hence it is based on circumstantial evidence, and Gribkowsky’s testimony will be of utmost importance to the court. Will Gribkowsky confirm Bernie’s version of what happened? Note the prosecutors have nothing to offer him in exchange for cooperation, while Bernie… I will remain silent on that matter!


Very well said.

Scuderia McLaren

Worst case scenario, the mystery that is Mr.E wears an ankle braclet for a few years and sits at home in Mayfair. It’s time he slowed up anyway and I hear the bracelets come in a wide variety of colours. Ferrari Red or McLaren Chrome. Anyway, the point is Mr.E is not going to spend a single night in the clink ala Gribowski.

The real questions are, ‘who are CVC going to start transitioning the role too now?’ Who can keep Napolean Bonatodt in line as well as manage the craziness that is the top 6 self serving giant teams and keep the tracks paying mega money year on year? The balance of power in a finely tuned and evolved beast in F1 that has taken decades to achieve an equilibrium of sorts. I shudder to think of a situation where CVC’s appointee could not keep LDM in line for example…

Think about it people.


Dude do ur thinking, when it comes to bribery we’re all friends until someone gets caught, after that its every dog for himself, who cares what hpns at the end just sit and enjoy the show.

Scuderia McLaren

True true.

*-gets come popcorn and sits back with pepe-*


That has to be the most unfortunate typo I’ve seen in a while. On the bright side at least you remembered the final ‘p’ 🙂


The German case – which is criminal – is much more important and interesting than the one in London. The one in London would in the worst case end up by Bernie paying a load of millions, and that would be it (apart from less tangible reputation issues – if he cares at all…). While on the criminal front you simply should not mess with the German prosecutors, they are not a gullible bunch. I cannot believe how naive Bernie’s defence sounds in that one front… Whether or not to indict, the German court will hear the case in a matter of months.


Bets on BE exiting his mortal coil before the trial ends.


Bets on him exiting the country at least 😉


Yes Random like he just punched himself in the right eye.

You don’t know the Bernie Hublot watch theft/assault story? Why don’t you google image “Bernie Hublot” and see what comes up.


OK, found it 🙂

Trust Bernie Ecclestone to manage to turn a mugging into a money-making opportunity.

The Formula One boss, who is worth an estimated £2billion, was attacked by four men outside his office in Central London last month.

But even before he’d had his four stitches removed, Mr Ecclestone contacted Formula One’s official watchmaker, Hublot, and suggested they used pictures of his battered face as part of an adverting campaign.

Never knew about this, but then I don’t watch the news and I’m not exactly what you’d call the epitome of the Hublot wearing demographic 😉

The best part for me? He was attacked by four guys. Four guys! To beat up guy who’s more than eighty years old!

These must have been the four of the weakest most contemptible cowards to skulk the face of this Earth.

Maybe if they’d stopped beforehand and thought about things for a second they might have thought of asking Bernie for a few pointers about how to make a quick buck. Maybe then they could avoid taking the risk of being beaten up by the next old person they try to mug 🙂


What’s up with the above photo by the way? Is Bernie trying to steal a Hublot from himself?


Looks more to me like he just punched himself in the face 🙂


an FOM live feed from the court room would prove a big money spinner for sure.


Additional F1+ subscription required from sky to see it


He would love to if he could!


Do you know the hearing details James? Wouldn’t mind heading along and seeing how it all plays out.


High Court, Fleet St London Starts tomorrow, Bernie due to give evidence early next week I believe


You can just hear Constantin Medien prosecutors

“It was Multi 21, Multi 21 ,Bernie” and The defendant –

“I wasn’t sure what the team wanted so I just went for it anyway ” besides they didn’t deserve it… lol how can they expect credible leading drivers F1 when you have such questionable people running it.


Are public members allowed 2 attend such a case in england, in South Africa i’d only be able to attend if the F1 floatation had been successful.


Yes, in majority of cases


Fantastic, thanks for the info, live locally so will go and see the little fellow doing his thing.

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