"Claiming 'Travel Agency Taken by Hyundai Family 40 Years Ago'... Lost Again in Second Trial"

Seoul High Court, Seocho-gu, Seoul. Photo by Moon Honam munonam@

[Asia Economy Reporter Kim Daehyun] In the mid-1970s, former Freedom Air CEO Shim Jaeseop filed a lawsuit claiming that Hyundai Group had taken over his travel agency, but he lost both the first trial and the appeal.

On the morning of the 8th, the Seoul High Court Civil Division 14-1 (Presiding Judges Kim Jongwoo, Lee Youngchang, Kim Sejong) ruled in the appeal trial of the ownership confirmation lawsuit filed by former Freedom Air CEO Shim against Jung Monggeun, Honorary Chairman of Hyundai Department Store, and others, just as in the first trial, the plaintiff lost the case. The court also ordered the plaintiff to bear the litigation costs.

According to former CEO Shim's claim, in 1977, he made a preliminary contract to acquire 70% of Freedom Air's shares with the late Chung Ju-yung, founder of Hyundai Group, former President Lee Myung-bak (then president), former director Park, and former deputy Na (contract handling officer). At that time, Hyundai needed a license for Freedom Air's air transportation agency business as it was sending about 10,000 workers to overseas construction sites. In return, Hyundai agreed to pay 300 million won in cash and one apartment.

However, former CEO Shim claims that while he was away on a business trip abroad that year, Hyundai Group took over the company. He alleges that only 80 million won of the deposit was received, and without a formal contract being signed, Hyundai Group staff came to the Freedom Air building and took company seals, resignation letters of the CEO, and other necessary documents for the company transfer without permission.

In 2020, former CEO Shim filed a lawsuit stating that "the rightful compensation for the stock transfer was not paid, and the stock transfer contract was signed under coercive methods, making it 'invalid,'" and demanded that "Chairman Jung, who received all shares of Freedom Air, return them all." He also requested that "Hyundai Department Store change the name on 64,000 shares owned by Chairman Jung, and Hyundai Green Food change the name on 160,000 shares owned by Chairman Jung to former CEO Shim, and that Chairman Jung pay 783 million won."

The first trial dismissed all of former CEO Shim's claims, stating that "the stock transfer does not appear to have been forced against the will," noting that the corporate seal was handed over by former CEO Shim's son, and that former CEO Shim himself was preparing the procedures necessary for the transfer of management rights. The testimony of former deputy Na was also based on information heard from former CEO Shim's side, making it difficult to fully trust.

The first trial court added, "Even if there was illegality in the process of establishing the legal act, it is difficult to consider the stock transfer contract itself as a void act against public order solely on that basis," and "it is hard to accept exercising stock rights after more than 40 years since the name change."

This content was produced with the assistance of AI translation services.