Directors' liabilities
SUPPLEMENT - THE IFLR GUIDE TO JAPAN 2009 - December 01, 2008
In a series of recent decisions, the Japanese Supreme Court has supported the decisions of the lower courts, which ordered company directors to pay significant claims for damages for failing to comply with their corporate responsibilities. In Janome Sewing Machine Co, Ltd (Supreme Court decision of October 2 2008), five ex-directors were ordered to pay ¥58.3 billion ($609 million) in damages to the company arising from the directors yielding to extortion demands from an organised crime operative. In Duskin Co, Ltd (Supreme Court decision of February 12 2008), two ex-directors were ordered to pay ¥5.3 billion for failing to disclose past sales of food contaminated with unlawful chemicals that were later discovered in an official inspection. In Hokkaido Takushoku Bank (Supreme Court decision of January 28 2008), 14 ex-directors were ordered to pay ¥10.1 billion due to their negligence in connection with various loans that had become uncollectible....
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