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Top court orders retrial for Lone Star

November 17, 2015

SEOUL (Yonhap) — South Korea’s top court Sunday ruled in favor of a U.S. buyout fund in a lawsuit involving the expenses for the liquidation of a joint firm between Lone Star and the state-run Korea Deposit Insurance Corporation (KDIC).

The order came after LSF-KDIC, an investment firm jointly established by Lone Star and KR&C, an affiliate under the KDIC, demanded KR&C pay around 40 billion won (US$34.3 million) to LSF-KDIC after a dispute over a piece of property.

The issue occurred when LSF-KDIC tried to sell a logistics terminal located in the southern port city of Busan. Lone Star demanded that KR&C pay for half of the expenses for handling the logistics terminal.

The case was sent to the International Chamber of Commerce International Court of Arbitration, which ruled in favor of LSF-KDIC in 2011. LSF-KDIC then asked the local court to implement the ruling by the global arbitration body.

South Korea’s district and high courts, however, ruled against the decision, adding that the arbitration is against the social norm in South Korea.

On Sunday, the Supreme Court said the decision by the international court concerning the dispute should be considered a valid one and sent the case back to the high court.