Samsung Electronics Executive Chairman Lee Jae-yong has been acquitted of all 19 charges related to alleged false corporate disclosures and accounting fraud at Samsung Biologics in both his first and second trials.
With all fact-finding trials in the case now concluded, prosecutors announced on Feb. 7 that they will appeal Lee’s acquittal to the Supreme Court. They argue that the two trials reached conflicting conclusions on key issues and that their rulings contradict a decision by the Seoul Administrative Court, which recognized accounting irregularities. In essence, prosecutors are challenging the factual findings of the case at the Supreme Court. Legal experts noted that while appeals are a routine procedural step, it is rare to dispute the facts in a case where both lower courts have delivered not-guilty verdicts. One legal expert remarked, “It is highly unusual for a defendant to undergo seven trials, including retrials and remand procedures, as Lee did in the influence-peddling scandal.”
The prosecution’s argument centers on discrepancies in the lower courts’ assessments of alleged accounting fraud at Samsung Biologics in 2014 and 2015. Although both trials acquitted Lee, they differed in their reasoning.
Regarding the 2014 accounting treatment, the first trial concluded that “Samsung Biologics’ finance team appeared to have collaborated with accountants to ensure proper accounting practices.” The appellate court, however, noted that “there were some deficiencies in the disclosure of call-option details” but determined that while lapses occurred, they did not constitute intentional misconduct. In other words, certain issues were identified, but they were not deemed serious enough to warrant criminal penalties.
For the 2015 accounting treatment, the appellate court acknowledged that “some defendants exhibited specific intent or took improper actions, such as document manipulation.” However, it also found that “when viewed as a whole, the reasoning and process leading to their decisions retained a minimal level of rationality.” During a review session for criminal appeals on Feb. 7, prosecutors reportedly emphasized the inconsistencies between the two rulings.
Despite this, legal experts questioned whether the appeal has merit, given that both lower courts ultimately ruled that no crime had occurred. A former deputy chief prosecutor stated, “Appeals are often framed as ‘misinterpretation of the law’ while effectively challenging ‘misjudgment of facts.’ However, since the facts have already been established in both trials, the Supreme Court’s ruling is unlikely to differ significantly.”
Prosecutors are also expected to argue that the lower courts were wrong to rule key evidence from the Samsung Biologics investigation inadmissible on the grounds that it was unlawfully obtained. A former high court judge, now a practicing attorney, noted, “The Supreme Court has consistently upheld strict standards regarding illegally obtained evidence, making it likely that the prosecution’s argument will be dismissed.”
