Wed, Sep 08, 2010 - Page 2 News List

Hsu acquitted in Sogo controversy

By Rich Chang  /  STAFF REPORTER

The Taiwan High Court yesterday upheld a verdict acquitting Far Eastern Group chairman Douglas Hsu (徐旭東) in the Sogo ownership scandal, while former Waterland Financial Holding Co chairman Walter Lin (林華德) was sentenced to two years in prison.

Lin is expected to begin serving his jail term soon.

Hsu, Lin and former Pacific Distribution Investment Co chairman Lee Heng-lung (李恆隆) were indicted for forgery and breach of trust by Taipei prosecutors in 2006 for their roles in a management takeover of the Pacific Sogo Department Store in September 2002.

The court said Lin, who agreed to help former Sogo chairman Chang Chi-min (章啟明) secure capital for Sogo when it was experiencing financial difficulties, instead secretly helped Hsu gain ownership of the store in 2004, which constituted a breach of trust.

The court said that as Lin secretly contacted Hsu to discuss the ownership of Sogo, there was insufficient evidence to show that Hsu knew Lin and Chang had an agreement on financial assistance.

Far Eastern Group injected capital into one of Sogo's subsidiary firms, Pacific Distribution Investment Co, and then took control of a majority of Sogo's shares in a manner that is legal and normal business practice in the eyes of the law, the court said.

Hsu's attorney, Yang Cheng-hsien (楊政憲), told reporters outside the court that Far Eastern Group was pleased with the final ruling and hoped the long-term dispute had been brought to a conclusion.

Lin was the only defendant found guilty by the court, while Lee's case is still pending.

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