Shareholder derivative lawsuit on behalf of the shareholders of Chin Yang Industry Co.,Ltd.(CYIC)

   Writer 한누리    l    Hit 35
2024.02.01 원문보기


Hannuri is proud to announce its recent victory in a shareholder derivative lawsuit on behalf of the shareholders of Chin Yang Industry Co.,Ltd.(CYIC), a publicly traded company in South Korea. This victory is the result of our dedication and expertise in protecting shareholder rights over the years.


In this case, the directors of CYIC transferred CYIC's export rights for polypropylene glycol without compensation to CK Enterprise Corporation, a company in which one of CYIC's directors is a controlling shareholder. As a result of this action, CYIC was fined a substantial amount of KRW 1.362 billion by the Korea Fair Trade Commission (KFTC) for violating the Fair Trade Act.


Hannuri's attorneys, Jiyon Kang, Jingu Park and Minsu Choi, with their unwavering commitment to protecting shareholders' rights, convincingly argued the blatant misappropriation of business opportunities, breach of duty by the directors and negligence by the auditors. The court upheld these claims and awarded damages equal to 60% of the sum of the KFTC penalty, the appraised value of the export rights and the additional taxes paid by CYIC.


This case sets an important precedent in the area of shareholder rights and corporate governance in South Korea, with a remarkably high ratio of damages awarded compared to other shareholder lawsuits. We are committed to continuing our advocacy for shareholder rights on appeal.


Hannuri has a longstanding commitment to shareholder rights advocacy that predates this case. Our extensive experience in shareholder derivative litigation is marked by a track record of success, including notable cases against individuals such as the Chairman of LG Group and the Chairman of Hyundai Securities. We remain committed to maintaining this high standard of excellence to ensure the best possible results for our clients in future cases.