Damage Recovery Procedures and Damage Relief Plan Organized by the East Sea Storm 

 

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Our hearts go out to the victims of the devastating events in the East. We hope that the many measures taken to recover from the disaster will be successful and that the victims will be able to recover from the disaster." 

 

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1. Through the first creditors' meeting, Dongyang was in its late 30s, and Leisure and International were in their respective Less than 10%, and T.W. Securities in the late 80s. While the solvency of the affiliates determines the recovery rate, there must be an assessment of whether the recovery plan is adequate, and the victims of TAIWA had a voice in the recovery process.

 

It is very important that the court management does its utmost to increase the recovery rate, but given the low solvency of the debtors, the Dongyang affiliates, it is clear that the majority of the damages will not be recovered, so it is necessary to take steps to recover the remaining damages.

 

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2.

 

(1) Financial Supervisory Service's adjustment of damages

 

1) The Financial Supervisory Service's conciliation decision is effective only if both Dongyang Securities and the victim agree. If either party disagrees, the victim must file a lawsuit to receive compensation for damages.

 

2) In accordance with the provisions of the 'Act on the Establishment of the Financial Services Commission', if you agree to the conciliation decision of the Financial Supervisory Service, you cannot file a lawsuit against Dongyang Securities to obtain additional compensation. If the FSA attaches a 'caveat' limiting the scope of the settlement, you can file a claim for additional compensation for the part not included in the settlement, but as of now (February 17, 2014), there is no official position that the FSA has limited the scope of the settlement. Therefore, if you agree to the settlement, you cannot file a lawsuit.

 

3) If the Financial Supervisory Service determines a high compensation amount and Dongyang Securities and the victim agree, the case is closed. If the FSA awards a high compensation amount, but the victim refuses to accept it, the victim can still file a lawsuit to collect the compensation amount, although the victim will not receive the compensation amount due to the refusal. This is because the FSA's decision in favor of the victim can be used as evidence in court.

 

But, In cases where the FSA dismisses a victim's application for dispute settlement, or determines a low compensation amount and the victim disagrees, courts give considerable evidentiary value to the FSA's decision, so even if the victim files a lawsuit against Dongyang Securities to obtain compensation, it is expected that the FSA's decision will make it difficult for the victim to obtain compensation.

 

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(2) Filing a civil lawsuit against Dongyang Securities

 

1) In order to get the money from Dongyang Securities that was not paid in the receivership, it is necessary to file a civil lawsuit against Dongyang Securities, which ultimately sold the bad debts to the victims.

 

2) Based on the analysis of the documents of hundreds of Asian victims, we found that a) the investor information in the investor information confirmation form was significantly false (such as misrepresenting the income of unemployed, retired, disabled, and stay-at-home mothers as more than 3 million won per month); b) evidence of Dongyang Securities' attempts to cover up its illegal behavior after the Dongyang crisis occurred; and c) internal materials created by Dongyang Securities (which did not explain the risks of investing at all) were also obtained and submitted to the court.

 

3) In addition, we expect to be able to attack Dongyang Securities very effectively, as all of the lawsuits filed have alleged and proven both 1) illegal acts committed by Dongyang Group (fraudulent issuance) and 2) mis-selling (fraudulent sales) in the sales process. Specifically, on January 8, 2014. The SEC's enforcement action is expected to significantly help the victims to recover their losses, as it involves 'fraudulent occurrence'.

 

4) In particular, the current chairman of Dongyang Group and Dongyang Securities officials have been indicted, and the lawsuit against Dongyang Securities was filed on the premise of fraud by the current chairman, and the complaint submitted to the court by the victims included both the illegal acts of the current chairman and Dongyang Securities. We will increase the amount of damages by having the victims submit the records of the investigation into Mr. Hyun to the lawsuit against Dongyang Securities. Currently, the Financial Supervisory Service, the Seoul Central District Prosecutors' Office, the Securities and Futures Commission, and others are continuing to produce favorable materials for the victims of Dongyang, and we expect that it will be very helpful to the victims.

 

5) Current status of complaints from victims in the East

 

The regions that have filed court cases are 1) Seoul, 2) Ilsan, 3) Chuncheon, 4) Nonsan, 5) Daejeon, 6) Gangneung, 7) Samcheok, and 8) Ulsan. More than 10% of the total victims (by amount of losses) have already filed lawsuits against Dongyang Securities through Hanbyul Law Firm and other law firms.

 

A review of the cases that have been initiated to date shows that it is easier to prove a case when victims across geographic regions band together{After analyzing the recordings, we found that the salespersons' methods of solicitation are almost identical in each branch of Dongyang Securities. Even if they lie in court, it is easy to prove incomplete sales (fraudulent sales) if the victims in each region collectively file a lawsuit}, and the amount of damages is expected to be relatively high. As a reminder, when you file a lawsuit, the court will add interest (prejudgment interest) to the damages you receive, which can be as low as 5% and as high as 20%. The interest is paid throughout the duration of the case, which means victims get more money.

 

6) What measures are you considering to compensate for the damage?

 

We will work to increase the damages award by taking steps such as sharing resources with law firms that are currently preparing lawsuits. We plan to work with the law firms that are currently advising Mr. Bieber, as well as those that have filed lawsuits, to help victims receive more compensation.

 

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7) About future procedures

 

). We are currently organizing an information session for victims. After the preparation is completed, we will explain and start the lawsuit. We will announce it through the homepage of Bie Wee or Hanbyul Law Firm (Limited).

 

b) Virtually all of the localities that have had information sessions to date have filed lawsuits quickly. After receiving a legally accurate explanation at the briefing, everyone expressed their gratitude, and after checking the law, relevant precedents, and similar cases for the things they had been misinformed about, they participated in the process of receiving compensation through court judgments.

 

b) If you don't want to join the lawsuit, you don't have to. We have so many people who are currently participating in lawsuits that we don't want to push people who don't want to participate into lawsuits that are necessary to recover damages. We respect the choice of victims who don't want to participate. However, we ask that you please refrain from malicious posts.

 

8) What victims should prepare

 

The lawyers will fight against Dongyang Securities, and it is unlikely that victims will come to court. If you are in a rural area, don't worry. If you look at the non-governmental legal counseling corner, there are things that must be prepared for the lawsuit posted by Hanbyul Law Firm (Limited) (documents such as the case history, subscription form, and listening to the recording). You only need to prepare what each victim needs to prepare.

 

For reference, this is a lawsuit against Dongyang Securities, which sold the above products, even if each product subscription is different, such as Dongyang, Inter, and Leisure, so you do not need to file a lawsuit for each product, so those who purchased multiple products do not need to worry.

 

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(3) Class Action

 

1) In Korea, a) The lawyer who filed the first class action lawsuit in Korea and b) successfully concluded the case is working at my firm, Hanbyul Law Firm (Limited). We have discussed the class action lawsuit and made a professional evaluation of it.

 

2) Class action lawsuits are meaningful, and I think that the lawyer who is going to file a class action lawsuit will do his best for the victims of the East. Please send encouragement and support.

 

3) However, there are risks to class actions. As a class action lawyer, I hope you are aware of these and are prepared. I'm assuming that the lawyers who brought the first class action and successfully tried the case have given you the information that they learned from their experience.

 

A) Class action lawsuits take more than three years just to get permission to sue as a class action.

 

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Class action lawsuits are preceded by a trial to obtain class certification, but because class actions are so powerful, the companies that are sued are desperate to defend themselves. Litigation is very lengthy (1 year and 2 months to 2 years for the first trial, and 3+ years if it goes to the Supreme Court).

 

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B) If you are granted permission to sue, you will have to file another lawsuit for damages.

 

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When you receive class certification, you don't immediately receive damages; you must start a new lawsuit to recover damages. Class certification and damages are two separate lawsuits, so it is estimated that it will take about six to seven years (up to the Supreme Court) for the actual damages to be awarded."

 

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C) Currently, all of the Dongyang Group companies, including Dongyang Securities, are in very poor financial condition. If the class action lawsuit is approved, it is likely that Dongyang Securities will be immediately shut down and go into bankruptcy. This could have dire consequences for the victims, who will not be able to receive compensation.

 

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La) In the meantime, even if a class action lawsuit is filed, you will still be able to file individual claims against Toshiba or its affiliates. The consensus among lawyers representing current victims is that they should move quickly to pursue their claims while the company is still alive.

 

3. Conclusion

 

(1) 1) criminal prosecution is not the only way to get compensation for damages, 2) even if the current chairman is detained, no money will be released, 3) in the rehabilitation process, the bonds can only be recovered over a period of 10 years depending on the financial condition of Dongyang affiliates, 4) if Dongyang Securities and the victims agree with the Financial Supervisory Service's decision, they cannot sue, and 5) all victims now know that they must file a civil lawsuit to get compensation for damages.

 

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(2) Many of the victims in the East have already filed civil lawsuits to recover damages, and we understand that the amount of damages filed in court has already exceeded 100 billion won.

 

The role of a lawyer is to provide accurate information. a) Whether you want to join the many Asian victims who have already filed a lawsuit, and b) agree with the FSA's decision and be done with it, and c) wait for a class action and get paid in 6-7 years (or up to 3 trials based on the typical length of a trial and the length of the first round of the two previous class actions).

 

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We are currently organizing information sessions for victims. We will explain and launch the lawsuit once we are ready.

 

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2014. 2. 17.

법무법인(유한)한별

Kang Rae-Hyuk, Sang-Young