Judge orders Deutsche Post, DHL chiefs to testify

Judge orders Deutsche Post, DHL chiefs to testify

The chief executives of Deutsche Post World Net and DHL Worldwide Express have been ordered to testify by the Department of Transportation's chief administrative law judge hearing the case regarding the ownership of DHL Airways.

Attorneys for Deutsche Post and DHL have appealed the order by Judge Ronnie L. Yoder, claiming that he lacks jurisdiction to enforce the subpoenas issued by FedEx Corp. and United Parcel Service.

FedEx Corp. and UPS contend that the carrier's ownership structure violated U.S. law restricting foreigners to 25 percent of the voting stock in a U.S. airline and 49 percent of the equity. Deutsche Post and DHL argue that FedEx and UPS are seeking to retain their duopoly of the U.S. express market.

In his order Friday, Yoder rejected the contention by Deutsche Post and DHL that Klaus Zumwinkel and Uwe Doerken, chief executives of Deutsche Post and DHL, respectively, should not be compelled to testify. In their motions, the Deutsche Post-DHL attorneys stated: "Neither man is a United States citizen. They do not work or reside in the United States. The companies for which they work do no business in the United States. Neither they, nor the companies for whom they work, are parties to this action."

Even if true, those contentions do not relieve Zumwinkel and Doerken of their obligation to testify, Yoder ruled, because "both individuals are officers of companies that have substantial ownership interest in DHLA (DHL Airways). Accordingly, Zumwinkel and Doerken are responsible for complying with subpoenas in this proceeding."

David Bolger, a spokesman for United Parcel Service, criticized Zumwinkel and Doerken for refusing to comply with the subpoena. "What are they hiding? Why aren't they willing to testify? They're quite vocal with their customers in marketing materials about their presence in the U.S., but when it comes time to answering a few questions about who really owns DHL Airways, Zumwinkel and Doerken hide behind their lawyers," Bolger said.

The dispute has delayed the planned acquisition of DHL Airways by an investor group led by John Dasburg, the cargo carrier's chairman, president and chief executive. The Dasburg team had hoped to complete the acquisition by June 30, but were unable to meet that deadline. Dasburg and his partners now hope to complete the deal by July 31. "Everyone's working very diligently" to wrap up the sale, said Ray Lutz, DHL Airways' vice president of business development and strategic planning.