Tam Chul-kon, the chairman of Orion Group, the confectionery company famous for Choco Pie, and his wife have reportedly been civilly sued for 20 billion won (US$18 million) by the former CEO of the company.
The Seoul Western District Court said on July 27 that Jo Gyeong-min, the former president of the company, filed a lawsuit on July 22 against Chairman Tam and his wife for not paying 20 billion won they had promised to offer 20 years ago. Jo, who had joined the company as an ordinary employee and moved up to the position of president, said that he withdrew his decision to leave the company in 1992 because Tam promised to pay 10 percent of the increased value of shares owned by him and his wife.
The former president argued that Orion’s share price has risen from 15.000 won (US$13) per share 20 years ago to 930,000 won (US$820) now, raising the value of the Tams’ shares by 1.5 trillion won (US$1.3 billion), and therefore Chairman Tam should pay 150 billion won (US$ 130 million) to hm. Jo sued against the Tams for 20 billion won among the 150 billion won in the first place.
Chairman Tam, a third-generation Chinese Korean, is the second son-in-law of Tongyang Group founder Lee Yang-gu. After Lee passed away, he, then the vice president of Tongyang Confectionery, took over managerial control of the company and took office as its president. Lee’s first son-in-law Hyun Jae-hyun took over Tongyang Group. President Tam separated Tongyang Confectionery from Tongyang Group and renamed it Orion, taking the position of chairmanship.
Chairman Tam diversified the company’s business boundaries from confectionary to other areas such as distribution, media and films. In 2013, he, along with his wife and vice chairman Lee Hwa-kyung, resigned from the board of directors after his getting sentenced to three years in prison and five years’ probation for embezzlement and other crimes. Even during the probation period, Tam got into troubles such as expediential property inheritance and awarding lucrative contracts to subsidies of Orion Group.