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The White-Collar Crime Practice Group at Lee & Ko achieved a significant victory representing Company A, a leading domestic securities firm, which had been accused by several complainant companies of violating the Act on the Aggravated Punishment of Specific Economic Crimes and the Capital Markets Act. The allegations stemmed from the sale of financial products tied to mezzanine loan receivables associated with a Las Vegas resort development project in the U.S. The complainants alleged that Company A failed to properly explain the concept of “DIL (Deed in Lieu)”, a method of collateral realization unique to U.S. mezzanine loan structures. Despite these claims, Lee & Ko successfully secured a full non-prosecution decision from the Seoul Central District Prosecutors’ Office. Lee & Ko also prevailed in defending against the complainants’ appeals and petitions for adjudication before the Seoul High Prosecutors’ Office and the Seoul High Court, resulting in the dismissal of all related challenges.

This case involved the unforeseen outbreak of the COVID-19 pandemic, which led to the suspension of the Las Vegas resort development project. As a result, defaults occurred sequentially on both the senior loan and the mezzanine loan associated with the project. Ultimately, the senior borrower executed a DIL, transferring the development property, which served as collateral, to the lender. Consequently, the mezzanine loan could not be recovered, leading to a complete loss of the investment in the financial product related to this case, which was worth tens of billions of Korean won.

In this case, Lee & Ko’s White-Collar Crime Practice Group conducted an in-depth analysis not only of Korea’s Capital Markets Act but also of U.S. legal literature and Nevada state law. Lee & Ko argued in detail before the prosecution that a DIL is not a special provision in the loan agreement but a commonly used legal mechanism in the U.S., and therefore not a critical factor in deciding whether to invest in the financial product. They further demonstrated that the DIL-related provision in the relevant contractual documents had no connection to the decision to invest in the financial product or to the resulting investment loss. Lee & Ko also presented that investing in mezzanine debt inherently carries the risk of principal loss, and the complainants were fully informed of this risk. As such, there was neither any deceptive act constituting fraud nor any use of unfair means, schemes, or artifices under the Capital Markets Act. By establishing these facts, Lee & Ko successfully cleared its client of criminal liability. As a result, Company A secured a more favorable position in the related civil litigation as well.
 

Lee & Ko successfully represented Samsung Fire & Marine Insurance, Korea’s leading non-life insurance company, in a case involving allegations of collusion among several major domestic insurers in bids for comprehensive property and fire insurance commissioned by Korea Land & Housing Corporation in 2017~2018. Lee & Ko achieved a complete acquittal for the client before the court of first instance.

This case involved: (1) several of the insurance companies that participated in the bids voluntarily reporting the alleged collusion to the Korea Fair Trade Commission (“KFTC”); (2) KFTC determining that collusion had occurred based on these voluntary reports and its own investigations, and subsequently imposing sanctions; and (3) the prosecution conducting a further investigation, relying on the voluntary reports and the KFTC’s findings, which ultimately led to indictments. There was substantial testimony and related evidence from the voluntary reporters that appeared to support the existence of collusion.

Lee & Ko conducted a meticulous analysis of the relevant legal principles, thoroughly reviewed the evidence, and proactively cross-examined witnesses to impeach all testimony and evidence suggesting the existence of collusion. At the same time, Lee & Ko provided clear and persuasive explanations regarding the structure and unique aspects of insurance bidding, as well as the circumstances at the time, actively arguing that there was no collusion as alleged by the prosecution and that the circumstances and statements cited as evidence could be fully explained without presuming collusion. The court held intensive hearings over more than two years and ultimately accepted the majority of Lee & Ko’s arguments, finding that there was insufficient evidence to establish the alleged collusion and delivering a complete acquittal. This case is significant in that, despite voluntary reports admitting to collusion and a range of related statements and court testimony, the court concluded that collusion was not proven and returned a not-guilty verdict. The outcome is regarded as a testament to Lee & Ko’s strong expertise and capabilities.
 

Lee & Ko successfully defended Mirae Asset Global Investments and Mirae Asset Life Insurance in a criminal case where the two companies were indicted for alleged violations of the Monopoly Regulation and Fair Trade Act (the “Fair Trade Act”). The prosecution alleged that the companies unfairly allocated business to a golf course operated by an affiliate with a high shareholding by related parties, thereby conferring undue benefits. On January 16, 2025, the court of first instance rendered a full acquittal on all charges.

The central issue in this case was whether the Mirae Asset affiliates intended to confer, or were willing to tolerate the conferral of, undue benefits to the related party through their use of the affiliate-owned golf course.

Representing Mirae Asset Global Investments and Mirae Asset Life Insurance, Lee & Ko focused on persuading the court that, in criminal proceedings, the ambiguous concept of “undue benefit” under the Fair Trade Act requires a higher standard of proof and a more rigorous assessment to establish intent. Lee & Ko argued that the use of the golf course was a rational business strategy consistent with the group’s ownership and use of such facilities, and that there was no intent or willingness to confer undue benefits to the related party at the time of use. As a result, the court found the prosecution’s allegations to be unsubstantiated and rendered a full acquittal.

This case is particularly significant due to the limited number of precedents addressing criminal liability for providing benefits to related parties under the Fair Trade Act. By emphasizing the need for strict proof and careful judicial assessment of intent, especially given the Act’s often ambiguous terminology, Lee & Ko was able to clearly demonstrate the absence of criminal intent. Through a meticulous review of evidence and extensive witness examinations, Lee & Ko effectively established its client’s position. The case underscores Lee & Ko’s deep expertise and strong capabilities in the area of criminal fair trade law.
 

Lee & Ko represented Samsung Electronics in an appeal regarding the case in which the company’s executives and employees were indicted and found guilty in the court of first instance of occupational negligence resulting in injury or death. The case arose from an accident at Samsung Electronics’ Giheung facility, where a carbon dioxide leak during the replacement of fire-fighting equipment resulted in three casualties. Through meticulous legal analysis and a thorough examination of the evidence, Lee & Ko developed the optimal defense strategy and ultimately secured an acquittal for Samsung Electronics’ executives and employees. Lee & Ko is currently representing the client in the appeal before the Supreme Court. 

The accident occurred when an improperly cut active wire triggered the carbon dioxide fire extinguishing system to operate, causing the connected selector valve to detach because it failed to withstand the pressure of the carbon dioxide, ultimately resulting in carbon dioxide leaking to the outside. 

In the first instance, the court determined that the accident was caused by the construction company’s negligence in improperly cutting an active wire, as well as Samsung Electronics’ executives and employees who failed to adequately manage the selector valve that emits carbon dioxide. The court thus found Samsung Electronics’ executives and employees guilty of occupational negligence resulting in injury or death.

Samsung Electronics retained Lee & Ko as its new counsel for the appeal. Lee & Ko emphasized that the detachment of the selector valve was a manufacturing defect, and that there was no legal or factual basis for imposing an obligation on Samsung Electronics, which simply purchased and used the selector valve, to inspect its pressure resistance. At the same time, Lee & Ko meticulously analyzed and contended that the first instance decision erroneously conflated civil law principles of product liability with criminal legal principles of occupational negligence. The appellate court sided with Lee & Ko’s arguments, acquitting Samsung Electronics’ executives and employees and overturning the first instance decision. This case exemplifies Lee & Ko’s strong advocacy skills to present the most effective case strategy and solution for clients.