Lee Jae-yong, chairman of Samsung Electronics, was acquitted in the case of the alleged unfair merger between Samsung C&T and Cheil Industries. With the Supreme Court's ruling on this day, he has freed himself from the 'judicial risk' that has persisted for 10 years since the merger of Samsung C&T and Cheil Industries in 2015.
Previously, Lee was already found guilty in the cases of 'bribery during the Park Geun-hye administration' and 'illegal propofol administration.' However, the lawsuit filed by the National Pension Service against Lee for damages caused by the merger of Samsung C&T and Cheil Industries is still ongoing.
The Supreme Court panel, led by Justice Oh Seok-jun, ruled Lee not guilty of 19 charges including illegal trading under the Capital Markets Act, market manipulation, and breach of trust. This conclusion is the same as that of the first and second trials. It has been 4 years and 10 months since Lee was indicted in September 2020 and 5 months since the second trial's ruling.
Lee was indicted in September 2020 for allegedly engaging in illicit trading, market manipulation, and accounting fraud, in order to succeed management at minimal expense during the merger process of Cheil Industries and Samsung C&T. During this trial, Lee appeared in court a total of 102 times, including 96 times in the first trial and 6 times in the appeals trial.
The Supreme Court's ruling on this day was the last remaining trial among the cases for which the prosecution had indicted Lee. Lee had already received a guilty verdict from the court regarding the bribery case during the Park Geun-hye administration and the illegal propofol administration case.
Lee was arrested and indicted in February 2017 on charges of bribery for allegedly giving more than 29.8 billion won to former President Park Geun-hye and Choi Seo-won (formerly known as Choi Soon-sil) in exchange for the succession of management rights of Samsung Group.
In February 2017, Lee was sentenced to 5 years in prison in the first trial, but in February 2018, he received a sentence of 2 years and 6 months in prison with a 4-year suspended sentence and was released. However, in August 2020, the Supreme Court judged some charges not recognized in the second trial as guilty and sent the case back for retrial. The Seoul High Court recognized the amount of bribery committed by Lee as 8.6 billion won in January 2021, sentencing him to 2 years and 6 months in prison. Accordingly, Lee was re-arrested at the Seoul Detention Center but was later released on parole after 207 days in August 2021.
Lee also faced trial for illegal propofol administration. He was charged in June 2021 for habitually administering propofol, a psychoactive drug, for non-medical purposes 41 times at a plastic surgery clinic in Gangnam, Seoul, from January 2015 to May 2020.
During the first trial of this case, Lee acknowledged all the charges. The first trial sentenced Lee to a fine of 70 million won and an additional 17.02 million won in forfeiture in October 2021. The sentencing was finalized as neither Lee nor the prosecution appealed.
Meanwhile, the Supreme Court's decision on this day is expected to impact the damages lawsuit filed by the National Pension Service (NPS) against Lee and others. Earlier, the NPS claimed that it suffered losses from the merger of Samsung C&T and Cheil Industries in 2015, filing a lawsuit in September last year demanding compensation of 510 million won from Lee and current and former Samsung executives.
The NPS was the largest shareholder, holding an 11.21% equity stake in Samsung C&T in 2015. That year, Samsung Group resolved the merger of one share of Cheil Industries for three shares of Samsung C&T at a board of directors meeting, which was approved at an extraordinary shareholders' meeting. The NPS believes it sustained losses because Samsung Group valued Samsung C&T lower than the market and Cheil Industries higher. The People's Solidarity for Participatory Democracy claimed that the NPS suffered damages amounting to up to 670 billion won from this merger.
This case has been assigned to the 31st Civil Division of the Seoul Central District Court (Director General Kim Sang-woo). The first hearing of this case is scheduled to be held on August 28.