Choi Tae-won Steps Forward: "Fatal Error in Ruling... No Halo Effect from the 6th Republic" (Comprehensive)

SK Group Takes Action: "Honor and Pride Tarnished"
Chey Tae-won: "SK History Denied... Decided to Appeal"

Choi Tae-won, chairman of SK Group, bowed his head and apologized, saying, "I apologize for causing concern and worry to the public due to personal matters," regarding his divorce lawsuit with No So-young, director of the Art Center Nabi. He directly expressed his intention to appeal, stating that a fatal error occurred in the appellate court ruling and that he will correct it.

SK Group Chairman Chey Tae-won is bowing his head in apology on the 17th at the SK Seorin Building in Jongno-gu, Seoul, regarding recent trial issues.
[Photo by SK]

On the 17th, the SK Supex Council held a session in the morning at the Supex Hall of the SK Seorin Building in Jongno-gu, Seoul, to explain the current issues related to the trial. They disclosed SK's position regarding the '6th Republic support theory' and revealed the 'serious error' found in the appellate court ruling.

"Fatal error in the 2nd trial ruling... will correct through appeal"

On that day, Lee Dong-geun, legal representative of Chairman Choi from the law firm Hwawoo, stated, "The appellate court made a serious error in valuing the shares of Daehan Telecom acquired by Chairman Choi in 1994." The core issue is that the valuation of the shares, which was the main point of contention in the ruling, was incorrect, resulting in an excessively exaggerated calculation of Director No's contribution as a supportive spouse.

According to lawyer Lee, the basic structure for judging the cause of the increase in stock value by the court is as follows. First, the period from when the Daehan Telecom shares were acquired in 1994 until the death of the former chairman Choi Jong-hyun in 1998 is considered the management period of the former chairman, and the increase in stock value during this period is not attributed to Director No's support. Then, the period from 1998 until SK Co., Ltd. was listed in 2009 is regarded as Chairman Choi's management period, and the stock value growth during this time is considered to have been contributed to by Director No's support.

Choi Tae-won and Noh So-young Divorce Trial Appeal Controversy Over Errors

Chairman Choi's side judged that there was a fatal error in assessing the contribution levels of the former chairman and Chairman Choi to the increase in shares. The appellate court ruling judged the contributions of the former chairman and Chairman Choi to be 12 times and 355 times respectively, but in reality, it should be 125 times and 35.5 times.

This is because, considering that Daehan Telecom (now SK C&C) shares, the foundation of SK Co., Ltd., underwent two stock splits, the court calculated the value of Daehan Telecom shares in 1998 as 100 won per share, whereas it should have been 1,000 won per share.

Lawyer Lee said, "(This matter) is a very basic premise in determining whether the SK Co., Ltd. shares, the most critical asset in this case, are marital property subject to division or Chairman Choi's personal property inherited from the predecessor, which is excluded from division," adding, "It is also a key premise in deciding the division ratio."

He added, "The ruling calculated the converted value of Daehan Telecom shares in 1998 as 100 won instead of 1,000 won, committing a significant accounting error."

"SK is not a company that grew with support from the 6th Republic... will restore the company's honor"

Lee Hyung-hee, Communication Committee Chair of the SK Supex Council, said, "Since the lawsuit is a personal matter, the group has not intervened so far, but after seeing the appellate court result, the judgment that SK grew under the slush funds and protection of the 6th Republic has been made," adding, "With 150,000 members, many customers, and investors, this has become an important issue that must be explained to everyone."

Chairman Lee judged that the company needs to investigate ▲ the exact method of delivery and use of the 30 billion won slush fund ▲ the specific handling results of the 10 billion won promissory note ▲ and the allegations of preferential treatment as a company related by marriage to the president.

Regarding the 30 billion won slush fund, Chairman Lee expressed regret that the claim that it was received from the Roh Tae-woo government is being treated as fact. He emphasized that it was never mentioned during the slush fund investigation of former President Roh in 1995. He also stressed that if there is any other undiscovered slush fund, it should also be identified.

About the 10 billion won promissory note, he said, "It was said that the note was presented in 2013 but then faded away, which is a very ambiguous expression," adding, "It needs supplementary explanation on whether it was received or not, and if not, where the note went."

Regarding entry into the mobile telecommunications business, he argued that considering the era, it was impossible for the influence of the previous government to continue into the next government. He emphasized that SK actually won the mobile telecommunications business rights in 1994 under the Kim Young-sam administration. Chairman Lee analyzed, "Although the ruling stated that the connection with the 6th Republic and the in-law helped SK acquire Korea Mobile Telecommunications and continuously grow, it was a society where it was very difficult for the power of being the president's in-law to be passed on to the next government, the YS government."

SK Group Chairman Chey Tae-won is expressing his position on recent trial issues on the 17th at the SK Seorin Building in Jongno-gu, Seoul.
[Photo by SK]

Choi Tae-won: "All of SK's history is denied... will correct at the Supreme Court"

Although not scheduled, Chairman Choi appeared at the announcement and expressed his position, attracting attention.

Chairman Choi said, "There is a ruling that denies all of SK's history as being built on the halo of the 6th Republic and that the business was grown by that halo," adding, "This is not true." He continued, "I believe that not only myself but all SK Group members' honor and pride have been damaged and diminished," and "I sincerely hope for a wise judgment from the Supreme Court and that this will be corrected."

He also said, "I apologize once again for causing concern and worry to the public due to personal matters," and "Regardless of this ruling, I will faithfully carry out my management duties to contribute to the national economy."

No director's side: "It is inappropriate for the company to respond to a personal lawsuit"

No director's legal representative, lawyer Lee Sang-won, stated in a press release after SK's announcement, "It is very regrettable that there is an attempt to exaggerate some parts to obstruct the judiciary's judgment. It is also very inappropriate for SK Group to respond at the company level to Chairman Choi's personal lawsuit."

Lawyer Lee said, "The appellate court's reasoning is that it is wrong to distort the legal principles of property division. The huge increase in SK C&C stock value is only part of the argument and does not affect the conclusion even according to the plaintiff (Chairman Choi)," adding, "Rather, I hope Chairman Choi expresses his position on the option of disclosing the entire ruling to the public for judgment."