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August 12, 2010

Germany facing lawsuit by World Holdings LLC over decades old bond default

The U.S. Court of Appeals for the Eleventh Circuit issued an opinion on Monday, August 9, 2010, affirming the U.S. District Court for the Southern District of Florida's denial of Germany's motion to dismiss the Complaint for lack of subject matter jurisdiction in the case of World Holdings, LLC v. The Federal Republic of Germany. This ruling means that Germany is not entitled to sovereign immunity from a lawsuit filed in 2008 by Florida-based company World Holdings, LLC. The suit alleges Germany failed to honor payment obligations on bonds marketed and sold in the years following World War I.

World Holdings filed an amended complaint in the case on June 3, 2008, in federal court in Miami to obtain payment on U.S. Gold bearer bonds, known as Dawes Bonds and Young Bonds, that Germany issued to thousands of individual American and other investors in 1924 and 1930. The bonds were bearer bonds sold in the United States, traded on the New York Stock Exchange and backed by the full faith and credit of Germany. World Holdings currently owns or controls a large number of Dawes and Young Bonds sold to U.S. purchasers and is charging Germany with breach of contract based on the country's alleged default of its obligation to pay the outstanding principal and accrued interest on these bonds. The lawsuit seeks damages in the amount of outstanding principal and accrued interest.

"We are pleased by the court's decision," said Motley Rice attorney Mike Elsner, who represents World Holdings. "We may now move forward with the case, and our client will have the opportunity it deserves to establish that its bonds should be enforceable and that Germany should be held accountable." 

About Motley Rice LLC

Motley Rice LLC is one of the nation's largest plaintiffs' litigation firms. Motley Rice attorneys gained recognition for their work on behalf of asbestos victims, the State Attorneys General in their landmark litigation against Big Tobacco, and the 9/11 families in their groundbreaking lawsuit against terrorist financiers. With more than 60 attorneys and hundreds of staff, the firm continues to handle complex litigation, including cases in the areas of aviation disasters, securities and consumer fraud, shareholder rights, asbestos bankruptcy, occupational disease including mesothelioma, environmental contamination, human rights, drugs and medical device defects. Motley Rice is headquartered in Mount Pleasant, South Carolina, and has additional offices in Connecticut; Washington, D.C.; New York; Rhode Island; and West Virginia. For more information about Motley Rice LLC and the lawsuit by World Holdings against The Federal Republic of Germany, contact Motley Rice attorney Mike Elsner (NY, SC, VA) at +1 800.768.4026.