In the case where an executive of Company P was prosecuted on charges of violations of the Act on the Aggravated Punishment, Etc. of Specific Economic Crimes (misappropriation) on the grounds of causing damages to the company economically through the acquisition price (approximately KRW 160 billion) by unfairly acquiring the target company at a high price in the process of M&A, DR & AJU in defense of the executive recently drew the Supreme Court’s final ruling of acquittal.

On the basis of a wide range of related materials, DR & AJU successfully convinced the panels of the court of first instance, the court of second instance and the Supreme Court that the defendant (client) was not guilty by aggressively arguing the main points as follows: Looking into the contemplated M&A from legal, accounting and management perspectives, (i) the defendant was fully complying with all relevant procedures, such as reporting to the investment review committee or the board of directors; (ii) the defendant fully reviewed the acquisition feasibility based on the professional consultants’ examination results in each area (securities company, accounting firm and law firm); (iii) the defendant executed this acquisition contract under the management judgment in the light of future outlooks and enterprise-wide operating directions; (iv) considering the value assessment result of the target company and the acquisition structure, the acquisition price stayed within a reasonable level; and (v) even from the aspect of legal principles, the prosecution’s indictment presuming the full amount of acquisition price as damages was unreasonable.

In this case, DR & AJU not only presented detailed criteria for judgment over the scope of duties of a director in the process of M&A, but also explained intelligibly how the premium based on the management rights should be reflected in the acquisition price, and what the detailed judgment and consideration factors on ‘the acquisition of property profits’ and its consequential ‘property damage occurrence’ are. Therefore, this case has significance as an important precedent for cases relating to an executive charged of misappropriation.​