Unforgotten
Historical review
Responsibility for the tragedy was examined in criminal proceedings (1968-1970). A solution for the future financial support of those affected was found in a separate out-of-court settlement for civil damages.
- In the so-called Thalidomide trial, criminal proceedings were conducted to determine whether senior Grünenthal employees could be held personally responsible for the consequences of marketing the drug. After 283 days of hearings, the judges concluded that the individual guilt of the defendants, even if it could have been established at all, would have been considered minor at best. The criminal trial was then discontinued without a verdict.
- Regardless of the outcome of the ongoing Thalidomide trial, a solution had to be found for the most urgent concern: supporting the affected families and providing them with financial security. Our company worked with the affected families to find a solution outside of the Thalidomide trial: Grünenthal guaranteed a payment of 100 million German marks to those affected. The German government contributed the same amount, so that a total of 200 million German marks, plus interest, could be paid into the German Federal Contergan Foundation. This Foundation continues to provide financial support to those affected to this day.
Criminal proceedings without conviction: court discontinues case
The Thalidomide trial centred on the question of whether nine former senior employees of Grünenthal were culpable for causing nerve damage in adults and malformations in unborn children through their actions – or lack thereof.
The court found it difficult to answer the question of the defendants' guilt conclusively. The trial was ultimately discontinued without judgement. The court justified its decision in December 1970 in a discontinuation order (in German) comprising around 100 pages.
The court stated two main reasons why continuing the criminal proceedings would have been disproportionate:
- Even in the hypothetical case that, after an orderly completion of the proceedings, misconduct by the accused had been found, the individual culpability of the accused would have been considered minor, despite the serious consequences. Among other factors, the Court took into consideration that there had been no explicit advertising for the use of Thalidomide during pregnancy. In addition, the company withdrew its Thalidomide-containing products just a relatively short time after Dr Lenz expressed his suspicions for the first time.
- Furthermore, it was no longer necessary to continue the criminal proceedings for overriding reasons (designated as in “the public interest” in the German Code of Criminal Proceedings). The Court referred to the fact that Grünenthal and the attorneys for the affected families had already reached a settlement in April 1970 in which Grünenthal agreed to pay 100 million German marks.
The Court explained its decision to terminate the proceedings in detail in a public hearing. The court's decision was widely welcomed by the public as a reasonable one.
“The claims of the deformed children for compensation are satisfied on the grounds of the legally binding obligation of Chemie-Grünenthal to pay '110 million German marks, including interest,' far more quickly and probably more extensively than would have been possible through civil proceedings. (...) Thus, the by far overwhelming majority of victims participating in these proceedings as joint plaintiffs did not object to termination.”
Excerpt from the discontinuation order of the First Grand Criminal Chamber of the Aachen Regional Court, p. 97
Solution for the long-term financial support of those affected: the Contergan Foundation
Even though the German Thalidomide trial was still ongoing, an independent solution had to be found for the most urgent concern: supporting the affected families and helping them gain financial security. This was urgent because even if the accused had been convicted following the criminal proceedings, a conviction would not have led to an obligation for Grünenthal to compensate the families. Each affected family would then have had to assert any claims for compensation against the company in separate civil proceedings. More years would have passed before a final clarification.
To avoid this, Grünenthal and the affected families found a joint solution: they reached an out-of-court settlement (on 10 April 1970, more than half a year before the end of the criminal proceedings). The key result was that Grünenthal agreed to pay 100 million German marks to support the affected children. The German government provided a further 100 million German marks. This led to the creation of the German Federal Contergan Foundation. To this day, it remains the basis for long-term, comprehensive financial support for those affected by Thalidomide.
In 2009, Grünenthal voluntarily paid an additional €50 million into the Contergan Foundation to make a further contribution to improving the daily lives of people affected by Thalidomide.
Key points of the settlement under civil law
On 10 April 1970, long before the termination of the proceedings in December of the same year, the affected families reached an out-of-court settlement with Grünenthal through their attorneys. The most important result of the settlement was the commitment by Grünenthal to pay 100 million German marks to support Thalidomide-affected children.
Before the money could be paid out to the affected families, however, two preconditions had to be met:
- The parents of the affected children feared that the social benefits owed to them by the State would be offset against the settlement payment from Grünenthal. This would have meant that the children would not have received any additional financial support despite the settlement.
- Grünenthal had committed to pay the amount of the settlement to the affected families on the condition that the company would be freed from further claims by health and pension insurers and other social insurance carriers.
The legislature met both preconditions with the creation of a foundation under public law. The law establishing the German Federal Contergan Foundation came into effect on 31 October 1972.
With the approval of the majority of affected families, Grünenthal paid the 100 million German marks promised as part of the settlement of April 1970 (equivalent to approximately €51 million, official conversion rate at the time of the introduction of the euro in 2002; taking inflation into account (in German), this corresponds to approximately €226 million in 2025) into the Foundation. Thus, the life-long support benefits of the German Federal Contergan Foundation replaced the claims under the settlement of the affected people.
The German Federal Contergan Foundation Act also stipulated two key points:
- Benefits paid by the Contergan Foundation could not be offset against any social security entitlements of those affected.
- No further claims could be made against Grünenthal, including by social security institutions.
The German Federal government paid an additional 100 million German marks into the Foundation's endowment fund, creating the basis for the ongoing and comprehensive financial support provided to people affected by Thalidomide to this day.