Japan’s Universal Entertainment Corp says it is taking measures to ensure it can file a claim for damages against its former Representative Director, President, CEO and CIO Jun Fujimoto, who is accused of breaching his fiduciary duty to the tune of US$43.5 million.
The potential claim relates to a finding by the Tokyo High Court on 25 April that Fujimoto breached his fiducial duty or duty of loyalty as a director of the company by causing it to transfer US$43,497,204 to an external source without reasonable necessity and without following internal decision-making procedures.
Universal said at the time that it would carefully examine the court’s decision before determining its next course of action.
Although the company revealed Friday that it had since had an appeal against the judgement dismissed on the grounds that the judgement has not yet become “final and binding”, it has now decided to take “necessary measures to ensure that our right to claim damages against Mr Fujimoto will be preserved in case the Judgment becomes final and binding as it stands.”
Universal has also established a task force, it added, to ensure that preservation measures are properly implemented, specifically the preservation of assets under Fujimoto’s name. According to the company’s latest filing, these include real estate, 658,000 shares in the company worth JPY1.08 billion (US$6.9 million), deposits and remuneration.
“For the purpose of continuing to take effective and efficient measures to preserve the claims against Mr Fujimoto, the company’s Representative Director and President has established a task force to strengthen cooperation with the outside directors and corporate auditors and to obtain advice from external experts,” it added.
“The impact on the Company’s business performance has not yet been determined.”
Fujimoto was, ironically, instrumental in the removal of Universal’s founder and former CEO Kazuo Okada – who he displaced as head of the company in 2017 after an internal investigation found Mr Okada had misappropriated company funds.
Both Fujimoto and Okada were the targets in a similar lawsuit from shareholder Tsuyoshi Hosoba in 2015, which alleged they and other Universal directors at the time had breached their fiduciary duties on various matters, including US$40 million in payments from affiliates of Universal to a Philippine consultant working on the Okada Manila integrated resort project.
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