Sam­sung

Austin American-Statesman - - MONEY & MAR­KETS -

than $1 bil­lion this year in its semi­con­duc­tor fa­cil­i­ties in Austin, bring­ing the to­tal in­vest­ment to $17 bil­lion at the site. Sam­sung em­ploys about 3,000 peo­ple in Cen­tral Texas.

Judge Lee Young-hun ac­cepted the prose­cu­tors’ ob­jec­tion that they had no prior no­tice when Lee’s lawyers tried to dis­play a Pow­erPoint presentation lay­ing out what they said was “the fun­da­men­tal prob­lem” in the pros­e­cu­tion’s case. Lee’s lawyers claimed state prose­cu­tors from out­side the spe­cial pros­e­cu­tion team that in­ves­ti­gated the case are un­qual­i­fied to join the pros­e­cu­tion team. Prose­cu­tors im­me­di­ately chal­lenged that con­tention. The judge said he will re­view the ar­gu­ments.

Four other Sam­sung ex­ec­u­tives also were charged. Like Lee, they were not at Thurs­day’s hear­ing and, through their lawyers, de­nied all al­le­ga­tions brought against them.

Prose­cu­tors believe Lee and his aides used Sam­sung cor­po­rate funds to bribe Pres­i­dent Park Geun-hye and one of her close friends in ex­change for sup­port­ing a smooth lead­er­ship tran­si­tion at Sam­sung. Prose­cu­tors al­lege Sam­sung gave or promised to give 43.3 bil­lion won ($38 mil­lion) to four en­ti­ties con­trolled by Choi Soon-sil, Park’s friend, who has been charged with mis­use of power and med­dling in state af­fairs.

Prose­cu­tors al­lege the money was given to ob­tain gov­ern­ment back­ing for a con­tentious merger of two Sam­sung com­pa­nies in 2015 that served as a key step in pass­ing cor­po­rate con­trol to Lee from his ail­ing father.

Lee is the high­est pro­file fig­ure ar­rested dur­ing the probe into the in­flu­ence-ped­dling scan­dal that has brought in­dict­ments of for­mer pres­i­den­tial aides and dozens of oth­ers.

The Con­sti­tu­tional Court is due to an­nounce a fi­nal rul­ing Fri­day on whether to re­move or re­in­state Park af­ter the par­lia­ment voted in De­cem­ber to im­peach her.

The hear­ing Thurs­day ended in one hour. It was in­ter­rupted twice by an el­derly woman who yelled that she wanted to ask a ques­tion be­fore she was es­corted out by the court’s se­cu­rity. Prose­cu­tors and Sam­sung lawyers agreed to re­view by the end of next week a body of ev­i­dence that runs 20,000 pages. The three judges on the panel did not set the next trial date.

The rul­ing at the Seoul Cen­tral District Court, which can be ap­pealed twice, will de­ter­mine whether Lee can re­turn to the helm of South Korea’s largest con­glom­er­ate, which was founded by his grand­fa­ther. It may also af­fect pub­lic opin­ion on the le­git­i­macy of his in­her­it­ing lead­er­ship of Sam­sung from his father.

Some view the case as a test of whether South Korea can root out deep-seated col­lu­sion be­tween gov­ern­ment and busi­ness lead­ers. It’s also seen as a test of whether the ju­di­cial sys­tem can end a tra­di­tion of le­niency to­ward white col­lar crimes com­mit­ted by chae­bol, as fam­ily-con­trolled South Korean busi­ness groups that dom­i­nate the econ­omy are known.

AHN YOUNG-JOON / AP

Lee Jae-yong, vice chair­man of Sam­sung Elec­tron­ics Co., ar­rives at the of­fice of the in­de­pen­dent coun­sel in Seoul, South Korea, on Feb. 22. Sam­sung lawyers have de­nied all charges brought against Lee.

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