In what is the largest case dispositions of its type that I have ever seen, a court in Tokyo has ordered four executives of Tokyo Electric Power Holdings (Tepco) to pay the company 13.321 trillion yen – the equivalent of $97 billion — based on the court’s finding that the individuals had negligently failed to take steps that would have prevented the disaster at the Fukushima Daiichi nuclear plant after the March 2011 earthquake and tsunami. This verdict, which is described in a July 13, 2022 Wall Street Journal article (here), is noteworthy on many levels, as discussed below.
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Japan
Guest Post: Appraisal Litigation in Japanese and Delaware Courts – Trends of Decisions on the Fair Price
In the following guest post, Makoto Ikeya, Managing Director, Alpha Financial Experts K. K., analyzes trends in Japanese and Delaware court decisions in appraisal litigation and presents a common recent trend in both jurisdictions to place heavy weight on merger price while highlighting differences on how to assess the fair procedure and other conditions to adopt the merger price as a base for the fair price. A version of this article previously was published on the Alpha Financial Experts’ website. I would like to thank Makoto for allowing me to publish his article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is Makoto’s article.
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Tokyo
The D&O Diary is on assignment in Asia this week, with the first stop for meetings in Tokyo, Japan’s capital city. Tokyo is such an amazing place. With a population of 13.8 million in the city itself and a total of 37.8 million in the Tokyo prefecture, it is by some measures the most populous city in the world. It is also a fascinating place. It is such a study in contrast, between the traditional and the modern, and between incredible organization and the disorder of its massive crowds.
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Securities Litigation in Japan
As I have previously noted, the prevalence of misrepresentation-related securities litigation in Japan increased significantly after the 2004 revisions to the Japanese securities laws. The increase largely has been due to the legislative changes and to a number of high-profile accounting and financial scandals. There are features of the Japanese law that, according to a recent review, make Japan “an attractive forum for securities litigation.” However, claimants still face a number of hurdles, as a result of which, according to a recent academic study, securities litigation in Japan “is still not a widespread phenomenon.” The June 15, 2016 Law 360 article entitled “A Look at Shareholder Remedies in Japan,” can be found here. University of Tokyo Professor Gen Goto’s January 2016 article “Growing Securities Litigation Against Issuers in Japan: Its Background and Reality” can be found here.
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Corporate Governance Reform in Japan
Japanese companies have not always had set the standard for corporate governance, but a current initiative of the current governmental administration is trying to change that. As part of ongoing efforts to try to revitalize the Japanese economy, an advisory committee to the country’s Financial Services Agency (FSA) has introduced a draft proposed corporate governance …
Japanese Securities Litigation Trends: 2000-2012
The volume of misstatement-related securities litigation in Japan has “increased dramatically” since the 2004 revisions to Japanese securities laws, according to a June 2013 report from the consulting firm Alix Partners. The report, entitled “Recent Trends in Japanese Securities Litigation: 2000-2012,” can be found here. Even though misstatement-related securities suit filings in Japan were…
Why There Aren’t Any Investor Lawsuits Yet Over the Olympus Accounting Scandal
For those of you who like me have been watching in disbelief as the accounting scandal engulfing Olympus Corp. has slowly unfolded like a slow-motion train wreck, I am sure you have many questions, but one that occurs to me in particular to ask is – why haven’t there been any lawsuits yet? After all, the company has…
NERA Releases Updated Study of Japanese Securities Litigation
The amount of damages awarded in 2009 Japanese securities cases exceeded "the aggregate amount of securities litigation damages determined by court decisions in Japan for the entire previous decade," according to a new study of Japanese securities litigation from NERA Economic Consulting. The report, dated August 2, 2010 and entitled "Trends in Japanese Securities Litigation:…
NERA Releases Japanese Securities Litigation Trends Study
As a result of legislative reforms and a changing enforcement environment, the number of disclosure related securities cases in Japan has increased in recent years and is likely to continue to grow in the years ahead, according to a July 15, 2009 report from NERA Economic Consulting. The report, which was written by Makoto Ikeya…