Japanese shareholder sues Olympus board for firing former chief executive Michael Woodford
A single Japanese shareholder of scandal-hit Olympus has sued 14 board members who sacked whistle-blowing British former chief executive Michael Woodford, according to lawyers. The shareholder, an anonymous man living in western Japan, filed the lawsuit, demanding the executives pay Olympus 1.34 billion yen ($17.5 million) for costs resulting from Woodford’s firing, one of his lawyers said. Woodford, the first non-Japanese to lead the camera and medical equipment maker, was fired in October after revealing a cover-up of $1.7 billion in losses at the firm. The damages demanded include compensation for the firm’s battered reputation and the cost of independent probes into the scheme commissioned by Olympus, he added. The 14 being sued were all on the board when Woodford was dismissed and include former chairman Tsuyoshi Kikukawa, who allegedly played a major role in the cover-up.
Olympus has admitted that it used over-priced acquisitions and consultancy fees to hide losses it had made on earlier investments, a case that has rocked global confidence in Japanese corporate governance. Shareholder activism is rare in Japan, where institutions tend to have cozy relationships with board members and cross-shareholdings are common. Olympus is already taking its own legal action against 19 current and former top executives, not including Woodford, for a combined $215 million in damages relating to the cover-up.Olympus also has sued five members of an internal auditing board after one of the independent probes found they bore some of the responsibility for the scandal, demanding one billion yen in total.