Former Namyang Dairy Products Chairman Hong Won-sik [Yonhap]
Former Namyang Dairy Products Chairman Hong Won-sik [Yonhap]

Namyang Dairy Products won a lawsuit Thursday brought by former Chairman Hong Won-sik seeking 44.3 billion won ($32 million) in severance pay, with the company saying it "respects the court's judgment."

The Civil Division 41 of the Seoul Central District Court, presided over by Judge Lee Gyu-hun, ruled against Hong in his 44.36 billion won executive severance claim against the company.

In a related case, the court partially granted Namyang Dairy Products' counterclaim seeking the return of unjust enrichment. As a result, Hong must pay the company 1.172 billion won.

The dispute stems from Hong's decision to personally exercise his voting rights at the 2023 and 2024 annual shareholder meetings to set the director compensation ceiling at 5 billion won, drawing criticism over what observers called self-dealing on pay.

Those shareholder resolutions were later overturned by a court, but Hong filed the severance lawsuit after stepping down from the Namyang Dairy Products board in March 2024.

Separately, Hong has been indicted on embezzlement and breach-of-trust charges related to allegations of misappropriating company funds and accepting rebates. He received a three-year prison sentence and a 4.3 billion won surcharge at trial, and his appeal is currently underway.


spa@heraldcorp.com