60 Billion Won Bonus Lawsuit... Will Kakao's Kim Beom-su and Jeong Sin-a Appear as Witnesses?

Former Kakao CEO Lim Ji-hoon's 'Performance Bonus Claim Lawsuit'
"Founder Kim Beom-su and CEO Jeong Shin-ah Requested as Witnesses"
Court Undecided on Witness Acceptance, "Please Specify Claims"

"There are quite a few emails exchanged with 'Brian.' Only by calling him as a witness can the exact truth be uncovered."

"An email was sent from the American name 'Sina' stating 'It will be paid like this.' She is the person who best understands Kakao Ventures' intentions regarding the changed contract."

Recently, in a civil courtroom on the 4th floor of the Seoul High Court in Seocho-gu, Seoul, the side of former Kakao CEO Im Ji-hoon, who filed a lawsuit against Kakao Ventures demanding "payment of approximately 59.8 billion KRW in performance bonuses," made these remarks to the court. In the emails, Brian and Sina refer to Kim Beom-su, the founder of Kakao and head of the Future Initiative Center, and Jeong Sin-ah, the CEO of Kakao, respectively.

According to the legal community on the 8th, the side of former CEO Im argued at the first appellate hearing of the contract money claim lawsuit held under the Seoul High Court Civil Division 18-2 (Presiding Judge Park Seon-jun, Judges Jin Hyun-min and Wang Jeong-ok) that founder Kim and CEO Jeong should be called as witnesses.

Former CEO Im's side stated, "Kakao Ventures claims that they did not know that the change in the performance compensation contract required a shareholders' meeting, but this is fundamentally a violation of a reasonable obligation under the contract," adding, "If they knew and still did not act, they deceived former CEO Im and caused damage."

Accordingly, former CEO Im's side applied to call founder Kim and CEO Jeong as witnesses. The reason is to ask the parties why the shareholders' meeting resolution was not held and how they understood the necessity of such a resolution. They also said, "Founder Kim was the sole shareholder of Kakao Ventures and was involved in both the original and amended contracts, so he knows the details best," and "CEO Jeong was later the CEO of Kakao Ventures and a party to the amended contract."

On the other hand, Kakao Ventures countered, "Please specify who is responsible for the illegal act," and argued, "The premise is that the changed terms should naturally apply during the period of duty performance." The court said, "Please specify former CEO Im's claims in detail first," and "We will review whether to accept them later." The next hearing is scheduled for July 24.

Kakao Ventures was established in March 2012 under the name 'K Cube Ventures.' At that time, founder Kim held 100% of the shares. Former CEO Im became the first CEO of this company and signed a performance compensation contract in early 2015 to receive 70% of the performance bonus.

Subsequently, K Cube Ventures was incorporated as a Kakao affiliate. After former CEO Im was appointed as Kakao CEO in August 2015, the contract was changed to state "the compensation ratio is changed to 44%, but the full performance bonus will be paid regardless of the working period."

Accordingly, former CEO Im expected to receive performance bonuses in the range of 60 to 80 billion KRW, but Kakao Ventures withheld payment citing that the shareholders' meeting and board resolution were not held at the time of the performance bonus payment agreement in early 2015.

Lim Ji-hoon, former CEO of Kakao; Kim Beom-su, founder of Kakao and head of the Future Initiative Center; Jeong Shin-ah, CEO of Kakao

The K Cube No.1 Investment Association Fund was liquidated in October 2021. Accordingly, former CEO Im filed a lawsuit in March of the following year, claiming, "The promised performance bonus was not paid." He also argued, "At the time of the contract, Kakao Ventures was a single-shareholder company, and the approval was made through that resolution."

In November of last year, the first trial ruled against former CEO Im, stating "There was no related procedure." At that time, the court stated, "For the performance compensation change contract to be valid, a shareholders' meeting resolution is required, but since it was not held, the claim was dismissed."