Yonhap News Agency sues education foundation's management for breach of trust

▲ A man holds the complaint paper filed against Eulji Education Foundation Chairman Park Joon-young and Eulji Medical Center Chairwoman Hong Sung-hee for breach of trust on Nov. 22, 2023. (Yonhap)

Yonhap News Agency-lawsuit

Yonhap News Agency sues education foundation's management for breach of trust

SEOUL, Nov. 22 (Yonhap) -- Yonhap News Agency, South Korea's key news wire agency, on Wednesday filed a lawsuit against a local education foundation's chairman and his wife for breach of trust by inflicting financial damages on a hospital under its wing.

The two, Eulji Education Foundation Chairman Park Joon-young and Eulji Medical Center Chairwoman Hong Sung-hee, are accused of making the center donate its 600,000 shares in Yonhap News TV to the foundation in August in order to help it become the biggest shareholder of the TV channel, the agency said.

Yonhap News TV is a 24-hour news channel affiliated with Yonhap News Agency.

With the donation, the foundation increased its stake in the channel to 30.08 percent, and is seeking approval from the watchdog Korea Communications Commission to take control of the broadcaster.

Yonhap New Agency is currently No. 1 shareholder of the TV channel with a 29.89 percent share, slightly below the 30 percent cap stipulated by the broadcasting law.

The news agency said the couple "chose to donate the shares after learning, while preparing for a hostile takeover, that Eulji Medical Center is legally banned from participating in the management of Yonhap News TV," and that the share donation inflicted financial damages worth around 3 billion won (US$2.3 million) on the already debt-ridden medical center.

"Eulji Medical Center's debt amounted to 135.2 billion won, with its debt-to-equity ratio reaching 123 percent, as of the end of last year," the agency said. "This demonstrates the donation was designed only to take over the channel's management rights."

"As a news channel has vast influence over public opinion, it is crucial for a broadcaster to ensure fairness and the pursuit of the public good. But the two have none of those qualities," the agency said.

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