Background
In 2016, a listed pharmaceutical company disclosed favorable news of a "technology export deal worth over KRW 1 trillion" just after the market closed. The very next day, as soon as trading opened, it disclosed unfavorable news that "another technology export agreement had been cancelled." Investors who had bought in on the good news alone suffered heavy losses as the share price plunged at the open.
What Was at Stake
The key question was "why the bad news was announced only after the market had opened." The company argued that "the exchange's circumstances left it no choice." The issue was whether the timing of a listed company's disclosure is a mere formality or a substantive obligation for the protection of investors.
How Changchun Helped
Acting for the injured investors (minority shareholders), Changchun established as a matter of law that it was not impossible to announce adverse information before the market opened, and made clear that the company's explanation of "the exchange's circumstances" could not serve as a defense.
The investors prevailed at first and second instance and again in the Supreme Court, and the judgment ordering the company to pay damages became final. It is highly significant as the first case in which the Supreme Court recognized a listed company's liability in damages for "delayed disclosure." (Related coverage: Wikitree article) (Outcomes depend on the facts of each case and may differ.)