A significant lawsuit has emerged from the pandemic, with suppliers seeking 480 million euros from the Ministry of Health for undelivered Corona masks. Former CDU politician Niels Korte is involved, as his company initiated the case, now led by KLT. Despite missed deadlines, suppliers claim they are ready to fulfill orders at previous prices, contrasting sharply with current market rates. The Ministry could face substantial back payments, and legal challenges are mounting against the federal government over procurement issues.
Unprecedented Legal Battle Over Unfulfilled Corona Mask Deliveries
The largest lawsuit stemming from the Corona pandemic is currently unfolding, with multiple suppliers seeking to claim a staggering 480 million euros from the Ministry of Health due to undelivered Corona masks. Notably, a former CDU politician is entangled in this high-stakes case.
This legal dispute could potentially burden taxpayers significantly. A number of companies have taken their grievances to the Bonn District Court, claiming that although they failed to deliver masks within the initial timeframe, they are now prepared to fulfill these orders at the previously agreed price of 4.50 euros per FFP2 mask. In contrast, masks are now being sold for as little as ten cents, which would result in a hefty profit margin of 4.40 euros per mask. Even if these companies do not prevail initially, they may have better prospects in higher courts, as the Higher Regional Court of Cologne has previously ruled in favor of suppliers in similar situations.
The Ministry of Health could be facing potential back payments totaling approximately 420 million euros to these mask suppliers.
Former CDU Politician’s Role
One individual who seems optimistic about the lawsuit’s outcome is former CDU politician Niels Korte. A company in which he holds a partial stake through an intermediary filed the lawsuit, concerning claims from suppliers who had pledged to deliver Corona masks to the federal government back in spring 2020 but failed to meet their deadlines. Now, they are demanding 480 million euros plus interest for the masks that were never delivered, as outlined by Judge Jan Hendrik Büter at the start of a hearing.
Büter noted that shortly after Korte’s company Areal initiated the lawsuit in November 2023, there was a change in plaintiffs. The case is now being pursued by KLT, a Hamburg-based company, whose CEOs are former associates of Korte. The exact extent of Korte’s involvement remains unclear.
Commission Claims in Question
Outside the courtroom in Bonn, Korte stated that he is no longer actively involved in the lawsuit. KLT has indicated that the legal action pertains to the fulfillment of the ‘Open House’ contracts and that the companies are still intent on delivering the agreed-upon masks. A key legal issue is whether the ministry should have allowed for a ‘possibility for subsequent delivery.’ KLT has not disclosed any current agreements with Areal.
When asked about the lawsuit, Korte’s media lawyer emphasized that Korte does not hold any significant role in the proceedings and that Areal’s involvement is strictly financial. Any compensation would be in the form of commission payments contingent upon a favorable outcome in court.
It’s noteworthy that Swiss entrepreneurs have previously sold protective equipment to the Ministry of Health for a whopping 670 million euros.
Email Correspondence with Jens Spahn
Korte’s lawyer refrained from revealing the exact amount of the claim, stating that Korte’s company Areal has already incurred substantial legal costs. Should Areal win the case, they would receive only a small portion of the claims outlined in the lawsuit. Specifics regarding the commission payment remain confidential, as per an agreement.
Korte has a history with mask contracts; in 2021, he withdrew from a Bundestag candidacy after receiving a contract to supply masks to the Ministry of Health. He had even reached out to party colleague Jens Spahn to obtain tender documents, firmly denying any allegations that political connections influenced contract awards.
Widespread Legal Claims for Undelivered Masks
Across the board, numerous other suppliers are also pursuing legal action against the federal government at the Bonn District Court, with a total claim value of 2.3 billion euros for undelivered masks. An internal report from the federal government reveals that most of these cases involve situations where no masks were delivered, amounting to a dispute value of about two billion euros.
These lawsuits revolve around the so-called ‘Open House’ process initiated by the Ministry of Health under Jens Spahn. On March 27, 2020, the ministry announced that it would accept FFP2 mask deliveries from any suppliers at a fixed price, aiming to quickly secure necessary supplies.
However, the fixed price set by Spahn was already considered quite high, leading to an overwhelming response from suppliers, with over 700 delivery commitments received in mere days. What was initially budgeted at 500 million euros ballooned to 6.4 billion euros in promised deliveries, contingent upon masks being delivered by April 30, 2020.
Issues with Procurement Process
Many suppliers struggled to meet delivery deadlines due to procurement challenges, while others faced issues securing delivery dates. In some instances, the ministry rejected payments based on quality concerns regarding the masks. The Federal Court of Auditors has criticized the disarray surrounding mask procurement under Jens Spahn in multiple reports over the years.
Recent rulings regarding the disputes over Corona mask contracts suggest that taxpayers might be facing billions in potential costs.
No Comments from the Ministry
According to the OLG, the federal government could not simply terminate the ‘Open House’ contracts due to missed deadlines; rather, it should have established a grace period for suppliers, as is customary in business transactions.
The Ministry of Health has declined to provide any comments regarding the ongoing lawsuit in Bonn, stating, ‘The BMG does not comment on ongoing proceedings.’