WALLESS Represented SIA Publisko Aktīvu Pārvaldītājs Possessor in an Unprecedented Case in Latvia
On 19 May, the Riga Regional Court upheld the claim of SIA Publisko aktīvu pārvaldītājs Possessor (Possessor, previously known as Privatization Agency) for damages against Grindeks shareholders Kirovs Lipmans and Filips Lipmans and awarded damages of EUR 1.9 million due from them.
WALLESS representing SIA Publisko aktīvu pārvaldītājs Possessor, a state-owned company, responsible for the privatization of state-owned property, filed an unprecedented claim for damages caused to the state as a minority shareholder due to the failure of Grindeks majority shareholders to make a mandatory buyout offer, which led to a loss of approximately 2 million EUR to the state budget.
This case is unique in Latvia since, first of all, it is one of the first claims made under the Financial Instrument Market Law of the Republic of Latvia and second, it aims to collect damages that the state has incurred as a shareholder of one of the largest pharmaceutical companies due to the breach of an obligation set by the Financial Instrument Market Law of the Republic of Latvia.
Although the law envisages that majority shareholders are obliged to offer a buyout of shares to the other shareholders, there is no practice where shareholders failing to comply with this obligation would have been sued for damages. Thus, this case is unprecedented in Latvia and will be the source for new case law.