LEMMINKÄINEN CORPORATION STOCK EXCHANGE RELEASE 20 OCTOBER 2016 AT 9:50 A.M.
LEGAL PROCEEDINGS CONCERNING DAMAGES RELATED TO THE ASPHALT CARTEL: LEMMINKÄINEN TO RECEIVE REIMBURSEMENT APPROX. EUR 14 MILLION IN CAPITAL
On 20 October 2016, the Helsinki Court of Appeal gave its decisions concerning the damages related to the asphalt cartel.
Of those 25 claims, where Lemminkäinen was the only defendant, the Court of Appeal ordered Lemminkäinen to pay 18 claimants damages approximately EUR 6 million in capital, which is approximately EUR 9 million less than the District Court had ordered.
As regards the 12 other claims, where Lemminkäinen and other asphalt industry companies were defendants, the Court of Appeal ordered the defendants to pay 8 claimants damages approximately EUR 14 million in capital, which is approximately EUR 5 million less than the District Court had ordered. In these claims, Lemminkäinen's liability to pay is partly joint and several together with other defendants.
Contrary to the decisions of the District Court, the claims of the State of Finland and one municipality were partly accepted. These decisions are included in the figures above.
The defendants were ordered to pay interest and legal expenses approximately EUR 3-7 million less than the District Court had ordered. Lemminkäinen's liability to pay is partly joint and several together with other defendants.
Lemminkäinen will later specify the amount of the total reimbursement which it is entitled to receive (capital, interest and legal expenses) based on the decisions of the Court of Appeal. Lemminkäinen will record the reimbursement as income in its fourth-quarter result.
"We are satisfied with the decisions of the Court of Appeal to the extent our appeals were accepted. Our daily operations will continue as planned, focusing on step by step improving our operational result and competitiveness in all our operations," says Casimir Lindholm, President and CEO of Lemminkäinen.
Lemminkäinen has as such deemed the claims for damages unfounded. Lemminkäinen will carefully study the decisions of the Court of Appeal. After this, the company will decide whether there are grounds for requesting leave of appeal from the Supreme Court. Lemminkäinen has 60 days to make such a request to the Supreme Court. The company will announce its decision separately once it has been made.
In 2009 the Supreme Administrative Court ordered seven Finnish asphalt industry companies (Lemminkäinen, Valtatie, Skanska Asfaltti, NCC/ Interasfaltti, Rudus Asfaltti, SA-Capital and Super Asfaltti) to pay an infringement fine due to violations of competition legislation during the years 1994-2002. The infringement fine imposed on Lemminkäinen was EUR 68 million.
On 28 November 2013, the District Court of Helsinki issued its decisions concerning damages related to the asphalt cartel. In line with the decisions, Lemminkäinen recorded approximately EUR 66 million in expenses in its 2013 result. Of this, approximately EUR 60 million consisted of damages ordered to be paid only by Lemminkäinen, Lemminkäinen's share of the damages ordered to be paid jointly and severally by Lemminkäinen and other asphalt industry companies, as well as interest and legal expenses related to the damages. This amount was paid by the company in January 2014.
Lemminkäinen appealed to the Helsinki Court of Appeal against all 35 decisions in which the plaintiffs' claims were partly accepted. In Lemminkäinen's opinion, there were some judicial aspects in the decisions of the District Court, where the conclusions of the District Court differed from previous legal praxis. Such judicial aspects were related, among other things, to questions regarding limitation periods and value added tax.
The Finnish state and 22 municipalities also lodged their appeals to the Helsinki Court of Appeal.
In addition to the claims, which the Court of Appeal now decided upon, 21 claims for damages are pending before the District Court of Helsinki. The capital amount of these claims is approximately EUR 26 million.
Casimir Lindholm, President and CEO
Tel. +358 2071 53304
Nasdaq Helsinki Ltd
Lemminkäinen is an expert in complex infrastructure construction and building construction in Northern Europe and one of the largest paving companies in its market. Together with our customers and 4,800 professionals we employ, we build a sustainable society. In 2015, our net sales were EUR 1.9 billion. Lemminkäinen Corporation’s share is quoted on Nasdaq Helsinki Ltd. www.lemminkainen.com