The Supreme Court of South Korea decided that former KT CEO Koo Hyun-mo is liable for damages caused to shareholders due to his creation of slush funds that were funneled into political contributions. In a significant ruling, the court overturned earlier decisions by lower courts that found no liability for Koo, despite acknowledging his illegal actions. The case originated from a lawsuit brought by 35 minority shareholders, who accused Koo and other executives of causing substantial financial losses through various misconducts, including the unlawful transfer of funds during the former administration and inappropriate sales of corporate assets.

The plaintiffs initially sought 76.5 billion won (about $65 million) in damages, arguing that the management's illegal activities harmed the company’s financial standing. Key accusations included the undervalued sale of corporate assets and improper contributions to political funds. While previous court rulings acknowledged Koo's violations of the law, they ultimately ruled that he bore no liability as the amount of slush funds used for political purposes had been returned to the company. However, the Supreme Court found that Koo's actions constituted a breach of his fiduciary duties and emphasized that he had failed to fulfill his responsibilities as a board member during the creation of these slush funds.

This ruling not only highlights the accountability of corporate executives in South Korea but also emphasizes the judiciary's commitment to protecting shareholder rights. The decision reinforces the notion that actions leading to financial misconduct will have legal repercussions, potentially affecting how corporate governance and oversight are approached in the future. This case may set a precedent for similar lawsuits against executives involved in governance failures, suggesting a tightening scrutiny on corporate responsibilities in South Korea's business environment.