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Samsung Electronics Chairman J.Y. Lee was acquitted Monday of charges of accounting fraud and stock price manipulation in a court in Seoul, South Korea.
The case was related to a 2015 merger that prosecutors said was aimed at establishing control of the tech giant. All 14 defendants in this case were acquitted.
Mr. Lee, 55, and other former executives were indicted on charges of orchestrating the merger of Samsung affiliates Samsung C&T and Cheil Industries in a manner that ignored the interests of minority shareholders.
Before the merger, the Lee family and its affiliates controlled Cheil Industries, but Samsung C&T, the major shareholder of Samsung Electronics, did not.
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Samsung Electronics Executive Chairman Jay Y. Lee attended the final judgment at the Seoul Central District Court and left his seat. (Getty Images)
Prosecutors had asked for a five-year prison sentence for Lee, who denied any wrongdoing and said he and other executives acted based on the belief that the merger would benefit shareholders.
A three-judge panel of the Seoul Central District Court said the decision to merge was reached after the boards of directors of both companies reviewed the deal.
Judge Park Jeong-jae said in court, “It cannot be concluded that the sole purpose was to strengthen defendant Lee Jae-yong’s management rights and facilitate his succession within the Samsung Group.” I called you by name.
This sentence prevents Lee from returning to prison. He was convicted in 2017 of bribing a friend of former President Park Geun-hye and served 18 months of a 30-month sentence. Mr. Lee was pardoned in 2022 by current President Yun Seok-yeol, who claimed that the government needed Mr. Lee’s support to overcome the “national economic crisis.”
If prosecutors do not appeal the verdict, it will be the first time since 2016 that Lee’s legal issues will be resolved.
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The Seoul Central District Court has acquitted Samsung Electronics Executive Chairman Jay Y. Lee in a controversial 2015 merger lawsuit. (Getty Images)
Kim Yoo-jin, Lee’s lawyer, praised the court’s “wise decision.”
Park Yong-jin, a lawmaker from the main opposition Democratic Party of Japan, criticized the ruling in a Facebook post, saying that Lee’s succession was unfair and that chaebol leaders should be protected from the perspective of a fair market economy. He said no.
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As of the end of September, the Lee family and related organizations hold 20.7% of Samsung Electronics shares.
Shares in Samsung C&T, the group’s de facto holding company of which Lee is the largest shareholder, rose as much as 5% before the ruling, but have since remained roughly flat, limiting profits.
Reuters contributed to this report.
