KK V DCX The fight goes on

WILMINGTON, Del., Jan 23, 2004; Jon Hurdle writing for Reuters reported that lawyers for billionaire investor Kirk Kerkorian filed a motion in U.S. court on Friday to demand that DaimlerChrysler's chief executive provide additional testimony about the 1998 Daimler-Chrysler merger that Kerkorian has branded a fraud.

CEO Juergen Schrempp, mastermind of the $36 billion deal, defended what he has long touted as a "merger of equals" during three tense days of testimony in the trial of Kerkorian's fraud lawsuit against DaimlerChrysler in U.S. District Court in Wilmington, Delaware, last month.

But attorneys for Kerkorian's Tracinda investment firm submitted their motion for further testimony from the mercurial German auto boss on grounds that critical new evidence had been produced by the defense after Schrempp took the stand.

They were referring to documents, mostly hand-written notes by former Chrysler Chief Financial Officer Gary Valade, that forced a sudden suspension of the trial in mid-December when DaimlerChrysler said they had been overlooked and never shown to Kerkorian's attorneys.

Valade was a senior figure in the merger negotiations and Tracinda claims his notes put the testimony of all previous witnesses in the fraud trial, but especially Schrempp's, in a different light.

"He must reappear for purposes of ... addressing the subject matter of statements attributed to him and others, as well as to testify about critically important matters relating thereto," Tracinda said in its motion, a copy of which was provided to Reuters.

It also demands that former Chrysler president Thomas Stallkamp be recalled to testify in the high-profile trial.

"Tracinda has been particularly prejudiced by being prevented from examining these two witnesses without the benefit of the delayed notes," the motion says.

Federal Judge Joseph Farnan, who is hearing the case without a jury, could not be reached for immediate comment after Tracinda filed its request of the court late Friday.

But a statement from DaimlerChrysler rejected the motion out of hand, calling it "unjustified, unnecessary and unfair."

Kerkorian claims that Schrempp and other Daimler executives pitched the 1998 deal as a merger rather than a takeover to lower the transaction price and avoid paying Chrysler shareholders a "control premium."

The reclusive casino mogul, who owned nearly 14 percent of Chrysler's shares before the Daimler-Chrysler link-up took place, is seeking more than $1 billion in damages.