Shin Dong-guk, Chairman of Hanyang Jeongmil, has won the first-instance trial in a legal battle involving a 60 billion won penalty suit brought by the Hanmi Pharm Group "four-party alliance" over the fallout of a senior care business project.

The ruling concluded that he is not liable to pay the 60 billion won penalty demanded by the Hanmi Pharm Group management.

The 30th Civil Division of the Seoul Central District Court (Presiding Judge Kim Seok-beom) ruled against the plaintiffs in the penalty lawsuit filed against Chairman Shin by Song Young-sook, Chairperson of Hanmi Pharm Group, her daughter Lim Joo-hyun, Vice Chairperson of Hanmi Science, and Killington Ltd.

Amid a management dispute within the Hanmi Pharm Group in December 2024, Chairperson Song and Vice Chairperson Lim formed a "four-party alliance" with Chairman Shin and Ladefoged Partners, signing a shareholders' agreement to jointly exercise voting and other rights.

Later, in June of last year, the Hanmi Science board of directors resolved to invest 16 billion won in the Banpo senior care business, conditional upon cooperation from Seoul St. Mary's Hospital.

Chairman Shin initially supported this and voted to pass the investment plan at an internal board meeting. However, five days later at a subsequent board meeting, he voted to retract the investment, citing reasons such as the lack of a firm commitment from St. Mary's Hospital, concerns over prolonged recovery of the investment, and difficulties in securing additional investors.

In response, Chairperson Song's side filed a lawsuit claiming 60 billion won in penalties, arguing that Chairman Shin had violated the shareholders' agreement.

The core issues were whether holding two consecutive board meetings to overturn the previous resolution was procedurally unlawful and whether this constituted a breach of the prior shareholders' agreement.

The first-instance court ruled that Chairman Shin's actions were lawful.

The court stated, "Given that there is no evidence to suggest that the fulfillment or non-fulfillment of the conditions stipulated in the prior resolution was communicated to the directors, submitting the agenda at a subsequent board meeting to verify whether those conditions were met and to make a final decision on the investment cannot be viewed as exceeding the agreement between the plaintiff and the defendant."

(Photo: Yonhap News)