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CJ Group owner family exempt from late father's debts

All News 11:58 March 09, 2016

SEOUL, March 9 (Yonhap) -- The head of CJ Group, one of South Korea's largest food and entertainment conglomerates, and his family members have been discharged from paying back billions of won in debt incurred by the late honorary chairman of the group, sources said Wednesday.

In mid-January, a local court accepted the request for a qualified acceptance filed by CJ Group Chairman Lee Jay-hyun, his mother and two siblings, seeking to be released from some 18 billion won (US$15 million) of debts left by Lee Maeng-hee, legal sources said.

Lee Maeng-hee is the current chairman's father and the older brother of Samsung Group chief Lee Kun-hee. Samsung, which includes Samsung Electronics Co., the world's largest smartphone manufacturer, is South Korea's No. 1 family-run business empire.

As the court ruled in favor of the plaintiffs, they are only obliged to repay the debts within the boundary of the amounts that they obtained from the deceased. Lee Maeng-hee was holding 600 million won in property when he died, according to the sources.

"The deceased had been living abroad for decades, apart from the family," a CJ Group official said. "The request was filed as there was no way to figure out what kind of financial transactions took place and how many liabilities were created in the process."

"As long as the family members did not stand as a joint surety for their father, they do not hold legal responsibility to repay the debts," a legal source said.

Lee died at the age of 84 in a hospital in China in August 2015. He had been treated for lung cancer there for months.

Lee Maeng-hee was the first son of Samsung Group founder Lee Byung-chull, who had three sons, including Kun-hee, and five daughters.

Maeng-hee had once been designated the heir of Samsung Group in the early 1960s, but he fell out of favor with the Samsung founder after having been blamed for chemicals smuggling charges in 1966.

Lee Kun-hee, the third son, took over Samsung Group in 1987 when the founder died, while Maeng-hee had stayed away from the business.

Lee Jay-hyun is currently in a hospital awaiting the Supreme Court's ruling on charges of embezzlement, breach of trust and tax evasion. His confinement has been suspended on several occasions since August 2013.

In December, Lee filed an appeal with the Supreme Court for the second time, arguing that he is innocent in regards to the charges for breach of trust.


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